- AUD/JPY has broken below 50-DMA support, we see more weakness on cards.
- PBOC’s massive yuan devaluation (largest since June 2016) to keep pressure on the antipodean.
- Technical indicators on daily charts have turned bearish. Stochs have rolled over from overbought levels.
- RSI has fallen below 50 level and biased lower. MACD is on verge of bearish crossover on signal line.
- The pair is currently holding 20-DMA support at 82.32. Decisive break below will accentuate the slide.
- Upside remains capped at daily cloud, break above will negate any bearish bias.
Support levels - 82.50 (100-DMA), 82.26 (20-DMA), 80.75 (channel base)
Resistance levels - 83.11 (converged 5-DMA and 110-EMA), 83.92 (July 19 high), 84.53 (June 7 high)
Call update: Our previous call (https://www.econotimes.com/FxWirePro-Aussie-slides-on-massive-yuan-devaluation-good-to-short-AUD-JPY-on-break-below-20-DMA-1405992) is progressing well.
Recommendation: Watch out for break below 20-DMA for weakness.
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 4.76999 (Neutral), while Hourly JPY Spot Index was at 100.225 (Bullish) at 0615 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
