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Risk-off flows seem to be picking up again!

Can NZD/JPY sustain this double top pattern breakdown before the trading week ends?

Before moving on, ICYMI, yesterday’s watchlist checked out AUD/USD’s descending triangle pattern ahead of the U.S. core PCE price index release. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

U.S. core PCE price index at 0.3% vs. projected 0.4% gain

U.S. personal income up by another 0.5% as expected

U.S. personal spending up by 0.2% vs. projected 0.4% increase

OPEC sticks with planned production hike of 648K bpd in August

Chicago PMI slumped from 60.3 to 56.0 vs. estimated 58.1 figure

Australian AIG manufacturing index improved from 52.4 to 54.0

New Zealand consumer confidence index down from 82.3 to 80.5 in June

New Zealand building consents dipped by 0.5% after previous 8.6% slump

Tokyo core CPI climbed from 1.9% to 2.1% as expected

Japanese unemployment rate ticked higher from 2.5% to 2.6%

Japan’s Tankan manufacturing index fell from 14 to 9 vs. consensus at 13

Japan’s Tankan non-manufacturing index up from 9 to 13 as expected

Chinese Caixin manufacturing PMI improved from 48.1 to 51.7 vs. 50.2 forecast

Eurozone flash headline CPI up from 8.1% to 8.6% vs. 8.5% forecast

Upcoming Potential Catalysts on the Forex Economic Calendar:

U.S. ISM manufacturing PMI at 2:00 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: NZD/JPY

NZD/JPY 4-hour Forex Chart

NZD/JPY 4-hour Forex Chart

Don’t look now, but NZD/JPY is perched right on top of its double top neckline!

Can it swoop below support and go for a reversal from here?

Technical indicators are still pointing to the presence of bullish vibes, as the 100 SMA is above the 200 SMA while Stochastic looks ready to pull higher.

However, the gap between the moving averages is narrowing to reflect slowing upward momentum and a potential bearish crossover. The pair has also fallen below both indicators, so these might hold as dynamic resistance.

A break below the neckline support around 83.00 could set off a drop that’s the same size as the reversal formation. That’s over 300 pips yo!

Earlier today, New Zealand reported a dip in consumer confidence for the previous month. Meanwhile, Japan’s Tankan survey printed mixed results for its manufacturing and non-manufacturing sectors.

A bounce or break might hinge on whether or not risk aversion extends its stay in the financial markets before traders take off for the weekend. Better keep those eyes peeled for reversal or continuation candlesticks!