AUD/JPY Price Analysis: Is a Correction Over?

The Australian Dollar has rallied scarcely 2% opposite a Japanese Yen given a Mar lows with a allege holding cost into near-term connection resistance. We’re looking for a greeting during this concentration with a crack above indispensable to keep a evident long-bias in play. That said, this rhythm indicate could also infer depot for a improvement off a lows- for now a concentration is on insurgency during 82.15.

AUD/JPY Daily Price Chart

AUD/JPY Price Chart - Daily Timeframe

Technical Outlook: In this week’s Technical Perspective, we highlighted a broader opinion for AUD/JPY with a near-term concentration on insurgency into a 82-handle. Price is contrast this operation today. The daily draft isn’t all that considerable here though does prominence some pivotal levels IF cost breaks aloft during 82.52 a 83-handle.

Key support stays with a 61.8% retracement / low-day tighten during 80.57/58– a mangle next this threshold targets, “79.45 and a median-line connection around 78.50s. Note that AUDJPY done a new multi-year low while AUDUSD has not; a inconsistency that mostly manifests itself during incomparable turns in price- keep a tighten eye here.

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AUD/JPY 120min Price Chart

AUD/JPY Price Chart - 120min Timeframe

Notes: A closer demeanour during cost movement see’s AUD/JPY trade within a proportions of a well-defined descending channel arrangement with a top together serve highlighting insurgency now around 82.15. Note that a movement form has exhibited a change in function with a oscillator anticipating support forward of 40 after reaching a top levels given mid-March (constructive).

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Bottom line: The evident risk is aloft though we’ll be looking for a near-term greeting here during connection resistance. A crack above looks for a widen into 82.52 83– both levels of seductiveness for exhaustion. If we destroy here again, demeanour for halt support during 81.26 corroborated by a reduce parallel, now around ~80.95 (near-term bullish invalidation). Ultimately a mangle next 80.57 would be indispensable to symbol resumption of a broader downtrend.

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AUD/JPY IG Client Positioning

AUD/JPY Client Sentiment

  • A outline of IG Client Sentiment shows traders are net-long AUDJPY- a ratio stands during +1.44 (59.0% of traders are long) –weak bearishreading
  • Retail has remained net-long given Mar 15th; cost has changed 2.4% reduce given then
  • Long positions are 1.8% aloft than yesterday and 12.8% reduce from final week
  • Short positions are 13.0% reduce than yesterday and 17.9% reduce from final week
  • We typically take a contrarian perspective to throng sentiment, and a fact traders are net-long suggests AUDJPY prices might continue to fall. Traders are serve net-long than yesterday and final week, and a multiple of stream positioning and new changes gives us a stronger AUDJPY-bearish contrarian trade bias from a view standpoint.

See how shifts in AUD/JPY retail positioning are impacting trend- Learn some-more about sentiment!

Relevant Data Releases

AUD/JPY Economic Calendar

Other Setups in Play

– Written by Michael Boutros, Currency Strategist with DailyFX

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