Wednesday, November 13, 2019
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Technical Analysis – AUD/JPY unlocks fresh highs

AUD/JPY unlocks fresh highs; next key resistance 76.26.

AUD/JPY stretched to a fresh 3 ½-month high of 75.65 and near the 200-day simple moving average (SMA) on Thursday but found it hard to close comfortably above the 50% Fibonacci of the down-leg from 80.70 to 69.94.

The price is currently trading slightly lower and even though the RSI and the MACD are fluctuating at a softer pace, the bullish bias is still intact as long as the former holds well above its 50 neutral level and the latter remains above its red signal line.

A rally above the 200-day SMA could stall somewhere between the July high of 76.26 and the 61.8% Fibonacci of 76.60. Breaking that area, the uptrend off 69.94 could gain some extra legs, with resistance probably moving up to 77.70 – a strong support area in the first three months of the year. Higher, the way would open towards the 78.68-79.00 region.

Failure to clear the 50% Fibonacci of 75.31 would shift attention down to the 20-day SMA. The 38.2% Fibonacci of 74.00 could also curb downside corrections if the sell-off extends lower, while beneath that, traders would lose confidence in the upward pattern, with the next obstacle probably coming within the 73.00-72.47 zone.

In the medium-term picture, the pair is in a sideways move and only a decisive close above 76.60 would mark a positive direction.

Summarising, AUD/JPY maintains a bullish but weaker short-term bias, with the next key resistance awaited to appear in the 76.26-76.60 area. Breaking that wall, the positive sentiment could also stretch into the medium-term timeframe.


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Disclaimer:
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.


Source: XM

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