On the NZD/JPY chart we can see the upward trend which was formed just a month ago. Now it is becoming more intense.
In particular, the Japanese yen lost some value today when the Bank of Japan revealed that it will not change its monetary policy, keeping the stimulus program intact. The Bank of Japan also stated that it won't raise interest rates in the foreseeable future, although it has reasons for the rate change and a tightening of the country's monetary policy considering the GDP's growth for five consecutive quarters and the good situation on Japan's labor market, despite the weak wage growth. Still, the Bank of Japan stated that they are not interested in strengthening the yen because the weak yen will have a positive impact on the economy and unemployment level.
The New Zealand dollar managed to strengthen against the weakening yen. Though, this week we received contradictory statistics affecting the NZD value: GDP growth was weaker than expected in both quarterly and YoY terms, achieving +0.5% and +2.5%, respectively. But the index of business activity PMI exceeded expectations and amounted to 58.5, which is the highest level since January 2016. In addition, the rapid strengthening of the NZD was also due to impressive data on the employment market in Australia, which is the main trading partner of New Zealand: the unemployment rate in May was 5.5% against the expected 5.7% and the level of change in the employment indicator was 47K in May which is in 4.7 times more than expected. Thus, the strengthening of the NZD has led to the breaking and moving of the resistance line. The MACD, Stochastics, and RSI oscillators unanimously indicate that the rates are in the overbought zone at the moment, so the probability of a price correction in the near future is very high. We can only agree with that because the short deals would be the most effective at the moment.
