FxWirePro: AUD/JPY holds trendline support at 80, break below to see further weakness

Refer AUD/JPY chart on Trading View

• AUD/JPY extends weakness after bearish gap open, bias lower.
   
• Fears of contagion from Turkey that threatens to spread throughout emerging markets and the European banking sectors keeps antipodeans depressed.
   
• Also, downside risks intact for the Aussie following the RBA's dovish SOMP on concerns about U.S.-China trade risks that are increasing.
   
• The pair has broken below daily cloud and channel base support at 80.80, drag lower likely.
   
• Technical indicators are highly bearish. Stochs and RSI are sharply lower and we see DMI and MACD support downside.
   
• Next major bear target below 80 lies at 61.8% Fib at 79.26. Violation there could see further weakness.
   
• On the flipside 55-EMA is strong resistance. Decisive break above could invalidate our bearish bias.

Support levels - 80.00 (Trendline support), 79.26 (61.8% Fib), 79

Resistance levels - 81, 81.60 (5-DMA), 82.36 (55-EMA)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-AUD-JPY-hovers-around-channel-base-support-at-8080-good-to-short-on-break-below-1414506) has hit TP1/2.

Recommendation: Book partial profits at lows. Hold for further weakness.

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -163.473 (Bearish), while Hourly JPY Spot Index was at 155.758 (Bullish) at 0545 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.