Forex: NZD/JPY off fresh Feb lows at 75.20

NZD/JPY is currently at 75.85, off fresh Feb lows at 75.15, printed in early NY session, down so far -3.15% for the week, following yesterday's Italian election results, and recent NZ trade balance figures. As Societe Generale noted: “NZ trade balance deteriorated on weaker exports and rising imports. Strong imports may be linked to reconstruction activity and hence not such a bad development,” the analysts said.

Data showed another trade deficit out of the last 6 trade balance figures, at -305M following previous positive one at +534M, below expectations at around 113M. NZ Visitors arrivals MoM also showed a bad number, falling -2.5% from a previous increase of +1.7%. The NZD/JPY might have built a head and shoulders reversal pattern with the head at fresh 4-year high Feb 14 79.64, while the neck line would be around the 77.45 level, already pull backed, and initial target accomplished at around the 75 handle.

Immediate support to the downside for NZD/JPY lies at recent weekly/Jan 28 lows 75.15/06, followed by Jan 23 lows at 74.03, and Jan 07 highs/Jan 16 lows at 73.50. To the upside, closest resistance shows at Monday's lows 76.06, followed by yesterday's highs/Feb 21 lows at 77.35, and Feb 13 lows at 78.10.