AUD/JPY chart on Trading View used for analysis
- AUD/JPY extending weakness after break below trendline support at 79.50, bias bearish.
- Price action has slipped below 61.8% Fib abd we see scope for further weakness amid trade war risks.
- The safe-haven Japanese currency remains bid on escalating US-China trade tensions, weighing on JPY crosses across the board.
- Trump threatens to up the ante in the trade war with China, USD200-467bn of 25% tariffs on China could come slamming down at any moment.
- Technical studies on weekly charts are highly bearish. Price action below major EMAs which are downward sloping.
- Momentum studies are bearish and Bollinger Bands are widening in support.
- Scope for test of 78.6% Fib at 76.26. While on the flip side, 5-DMA is immediate resistance at 79.52. Break above could see upside till 21-EMA at 80.50.
Support levels - 78, 77.58 (Feb 2016 low), 76.26 (78.6% Fib)
Resistance levels - 79.52 (5-DMA), 80.50 (21-EMA), 81
Call update: Our previous call (https://www.econotimes.com/FxWirePro-AUD-JPY-breaks-major-trendline-support-at-7950-786-Fib-in-sight-stay-short-1425482) has hit TP1.
Recommendation: Stay short for further weakness.
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -61.6227 (Neutral), while Hourly JPY Spot Index was at 45.7527 (Neutral) at 0645 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
