AUD/JPY edges lower on Friday in the early Asian session. The pair continued to move in between 0.8550 and 0.8570 for the two sessions. As of writing, the AUD/JPY pair is trading at 85.55, down 0.11% for the day.

Investors remained concerned about the global growth prospects on dismal economic data amidst central banks verdicts. The Japanese yen managed to attract buying interest on its safe haven appeal despite Bank of Japan’s (BOJ) dovish tone. In addition to that, the comments from BOJ Governor Haruhiko Kuroda on the depreciation of the yen did not deter the gains in the currency. The Unemployment Rate in Japan came at 2.8% in September, unchanged from the previous two months and in accordance with market consensus. The Industrial Production dropped 5.4% in September much below the market expectations of 3.2%. On Thursday, the market sentiment was upbeat, as portrayed by US stocks finishing in the green. Further, as the Asian session begins, investor mood turns sour, depicted by Asian equity futures dropping, except for the Japanese Topix and the Australian S&P/ASX 200.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

The daily chart portrays the cross-currency has an upward bias, depicted by the daily moving averages (DMA’s) remaining below the spot price with an upslope confirming the solid uptrend. The pair has been unable to break to the upside, despite three previous attempts amid having a risk-on market sentiment, which usually benefits the risk-sensitive Australian dollar.

Furthermore, Wednesday’s price action formed a doji, with long wicks on both sides, confirming indecision between buyers/sellers.

Furthermore, the Relative Strength Index (RSI) is at 72 in overbought levels, indicating the AUD/JPY pair may retreat, allowing the RSI indicator to exit from the abovementioned conditions before resuming the uptrend.

Therefore, in case of a lower correction, the first meaningful support level would be the October 22 low at 84.61

AUDJPY Tackling 50% Fibo on Monthly Chart.

Nov 01 2021