A weak news background and a low volatility make the best solution to open the deals on the trend.

For the last three months the rates have been in the frames of a rapid upward trend. At the same time, since January the volatility has decreased in the absence of an intense news background for both currencies. The New Zealand dollar has been strengthening due to the rising prices for raw materials. The situation will not change in the near future. Any important economic and political events are not expected in New Zealand and Japan for a while.

This week both currencies have been supported. On Tuesday the yen was supported after it became known that the Bank of Japan reduced the amount of redemption of government bonds. Investors had interpreted this as a sign of monetary policy tightening by the Bank of Japan for this year. As a result, the Japanese yen strengthened against most currencies.

The New Zealand dollar continues to be supported by the rising prices for raw materials this week. The Global Dairy Trade Price index increased by 2.2%. Import grew in China by just 4.5 percent in December - that somewhat restrained the growth of the NZD, but did not change the situation.

NZD/JPY, H4
The MACD and Stochastics oscillators show contrary signals at this time. In this situation the best move would be the deals on the trend, which can be effective in the short and medium term.