AUDJPY fell off the cliff yesterday after the BoJ intervened in the market to boost the wounded yen. Although the fall triggered some buy orders near 93.55, the recovery remained short lived, and another round of selling was initiated today from near 94.73. Overall, the pair remains below a tentative downside line taken from the high of September 13, as well as below the prior upside support line drawn from the low of August 5, which probably implies that further declines may be looming.
Both the RSI and the MACD are detecting strong downside speed, which adds to the notion of further downside. The former lies near its 30 line and points down, while the latter runs below both its zero and trigger lines, pointing south as well.
A clear and decisive dip below 93.55 would confirm a lower low on the 4-hour chart and may initially target the 93.05 level, marked by the low of August 15. Should buyers remain reluctant to enter from near that support territory, another negative leg may be triggered, perhaps aiming for the low of August 5, at around 92.20.
On the upside, traders may abandon the bearish case upon a break above 96.50. Such a move may also confirm the breach of the downside line taken from the high of September 13 and may see scope for advances towards the 96.40 territory, marked by the high of September 22. If that obstacle gets broken as well, then the gains may extend towards the 97.13 area, defined as a resistance by the high of September 15.
Summing up, AUDJPY fell sharply yesterday, distancing itself further from a short-term downside resistance line, as well as a prior upside one. This may be a recipe for some further short-term declines.
AUDJPY fell off the cliff yesterday after the BoJ intervened in the market to boost the wounded yen. Although the fall triggered some buy orders near 93.55, the recovery remained short lived, and another round of selling was initiated today from near 94.73. Overall, the pair remains below a tentative downside line taken from the high of September 13, as well as below the prior upside support line drawn from the low of August 5, which probably implies that further declines may be looming.
Both the RSI and the MACD are detecting strong downside speed, which adds to the notion of further downside. The former lies near its 30 line and points down, while the latter runs below both its zero and trigger lines, pointing south as well.
A clear and decisive dip below 93.55 would confirm a lower low on the 4-hour chart and may initially target the 93.05 level, marked by the low of August 15. Should buyers remain reluctant to enter from near that support territory, another negative leg may be triggered, perhaps aiming for the low of August 5, at around 92.20.
On the upside, traders may abandon the bearish case upon a break above 96.50. Such a move may also confirm the breach of the downside line taken from the high of September 13 and may see scope for advances towards the 96.40 territory, marked by the high of September 22. If that obstacle gets broken as well, then the gains may extend towards the 97.13 area, defined as a resistance by the high of September 15.
Summing up, AUDJPY fell sharply yesterday, distancing itself further from a short-term downside resistance line, as well as a prior upside one. This may be a recipe for some further short-term declines.
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