FxWirePro: AUD/JPY struggles at 'Triangle Base' at 85.50, further downside only on break below

• AUD/JPY finds strong support at 'Triangle Base' at 85.50, the pair is struggling to break below.
   
• Price action on the day has retraced brief dip below 85.50 and is currently at 85.83 levels.
   
• Wall Street's recovery overnight which has supported Asian markets today (which are trading largely flat) keep yen demand in check.
   
• Reports earlier today which showed a rise in China's iron ore imports likely to have kept the Aussie slightly bid.
   
• AUD/JPY edges higher on the day, up 0.38% as we write. We see weakness only on break below 85.50.
   
• Technical studies support downside. Price action has broken below major moving averages and daily cloud.
   
• Breach at 'Triangle Base' raises scope for test of 84.66 (Dec 7 low). Bearish invalidation on retrace above 200-DMA.

Recommendation: Watch for decisive break below 86.50 for further weakness, target 85/ 84.70/ 84.35.

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