FxWirePro: AUD/JPY struggles to hold retrace above 50-DMA, bias lower, stay short

• AUD/JPY edges lower from session highs at 87.64, struggles to hold retrace above 50-DMA.
   
• Aussie remained better bid on the back of upbeat Westpac consumer sentiment data, while the Yen failed to benefit from solid Japanese core machinery orders data.
   
• The Westpac Melbourne Institute Index of Consumer Sentiment for Australia rose 3.6% to 101.4 in October from 97.9 in September.
   
• Technical studies are bearish, RSI below 50 and RSI converges with price action. Stochs sharply lower, but at oversold levels, so some caution advised.
   
• Daily Ichi cloud is now strong support at 86.94, break below finds next major support at 200-DMA at 85.80.
   
• Bias lower as long as pair holds below 5-DMA at 87.55 which is sharply lower. Break above could see minor upside till 20-DMA at 88.42.

Support levels - 86.94 (cloud top), 86.55 (Sept 6 lows), 86, 85.80 (200-DMA)

Resistance levels - 87.55 (5-DMA), 87.58 (50-DMA), 88.42 (20-DMA)

Call update: We had advised a short in our previous call (https://www.econotimes.com/FxWirePro-AUD-JPY-extends-consolidation-recovery-attempts-capped-at-5-DMA-942081).

Recommendation: Hold for targets.

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 6.12622 (Neutral), while Hourly JPY Spot Index was at 50.9311 (Neutral) at 0620 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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