• The Kiwi’s grip on the yen loosens on Friday, heading towards the 20-day SMA.
• The cross is going through a consolidation phase while the bear position is strengthening.
• The defense around the 20-day SMA is starting to show signs of weakening, pointing to a potential decline.

The NZD/JPY pair faced selling pressure on Friday, with the cross falling towards the 20-day uncomplicated moving average (SMA) at 95.70. It appears that the consolidation phase may have tightened its grip around the pair, limiting buyers’ ability to stay the course in the market.

The Relative Strength Index (RSI) for the NZD/JPY pair is currently 53 on the daily chart, reflecting a decline from the previous session’s RSI value of 62. The movement of the RSI towards the neutral zone, away from oversold or overbought regions, indicates a moderate purchasing pressure. Meanwhile, the moving average convergence divergence (MACD) has begun to plot rising red bars, indicating increasing selling momentum and reinforcing the possibility of longer consolidation and even possible declines.

NZD/JPY daily chart

A decline in the cross towards the 20-day SMA coupled with increasing selling pressure has the potential to disrupt buyers’ defense of said support. Despite the recent jump from around 91.00 to 96.00 since early May, consolidation appears to be taking over, marking a break in the uptrend as gains consolidate.