Forex: NZD/JPY at multi-year highs above 70.00

FXstreet.com (San Francisco) - The NZDJPY is poised to break onto higher ground after advancing 1.4% on Wednesday, managing to take out the 69.70 level (Dec 23, 2009 high) to extend another leg higher to peak in the 70.30 price zone, levels not seen since October 2008.

The 200-month EMA, around 70.65, is expected to attract sellers if the bullish momentum persists, a break of which could open the door for a bullish run until 74.20 (Aug 12, 2007 low). Market participants continue to sell JPY in anticipation of an LDP victory in Japan's upcoming elections, and, therefore, the outlook remains bullish and traders are likely to employ a 'buy on dips' strategy in the medium-term.

Beyond the mentioned 69.70 mark (now immediate support), the cross may find support at 69.10 (Mar 19 high), 68.55 (Mar 27 high) and 68.30 (Feb 27 high); a break below there could open scope for a test of bids through 67.50 (April 13 high).

From Chris Tedder, Market Strategist at FOREX.com: "There is scope for more weakness from the yen from a fundamental standpoint, although we acknowledge headwinds against JPY have eased somewhat. The event risk tonight may decide the short-term fate of the pair, but we think there is scope for more NZD strength and JPY weakness in the long-term."