The NZD/JPY pair broke higher during the course of the session on Thursday, testing the top of the shooting star from Wednesday. With that being the case, the market looks as if it is trying to break out to the upside but I also recognize that the 80 handle is just above, and as a result the large, round, psychologically significant level could continue to offer pressure to the downside. However, the New Zealand dollar in general looks like it is trying to break out to the upside, and that of course should translate into this marketplace.
The NZD/JPY pair tends to move rather quickly, as the liquidity is a bit soft. That being the case though, you have to keep in mind that this pair tends to move with risk appetite in general. The higher the risk appetite, the higher this pair goes. So while stock markets can move risk appetite related pairs rather drastically, we also have to look at commodity markets as the New Zealand dollar is so tied to commodities in general.
If we can get above 80, this market should continue to go much higher, reaching towards the 83 level. However, I also recognize that a break down below the bottom of the shooting star from Wednesday could be a nice selling opportunity. That should send this market looking towards the 77 handle, which of course was resistive previously.
Keep in mind that this pair tends to move rather quickly, so a breakdown would more than likely send this market down to the 77 handle rather abruptly. Ultimately, I believe that the market should be an interesting place to express risk appetite in a global market that seems to be a bit confused at the moment. With that being the case, you will more than likely want to be very careful with your position size as, perhaps only trading half of the norm. However, this is a very quick market, and most certainly could offer profits.