FxWirePro: AUD/JPY finds strong support at 85.85, break below could see further weakness

• AUD/JPY is struggling to hold triangle breakout, is consolidating major slump overnight.
   
• Yen remians bid across the board on risk-off after Barcelona 'Terror Attack', dragging the pair lower.
   
• Intraday bias remains neutral. RSI flatlined below 50 levels. 
   
• Upside in the pair was capped at 20-DMA at 87.55, the pair has retraced from there on Thursday and is currently trading at 86.35 levels.
   
• We see strong support for the pair at 85.85 (triangle base), break below could see further weakness. 
   
• Bias on weekly charts is slightly bearish. Break below 85.85 raises scope for test of 84.79 (weekly 20-SMA).

Support levels - 86, 85.85 (rising trendline), 85, 84.79 (weekly 20-SMA)

Resistance levels - 86.39 (38.2% Fib retrace of 81.48 to 89.42 rally), 87.45 (20-DMA) 87.55 (23.6% Fib)

Call update: Our previous call (http://www.econotimes.com/FxWirePro-AUD-JPY-breaks-major-resistance-at-8675-good-to-go-long-on-dips-855174) has been stopped out after hitting TP1.

Recommendation: Watchout for break below 85.85 for further weakness.

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 50.2463 (Neutral), while Hourly JPY Spot Index was at 108.836 (Bullish) at 0545 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex. 

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