The AUD/JPY pair has observed some interest after a loss in the downside momentum around 91.50 in the Asian session, however, the downside looks favored. The risk barometer hogged the limelight after Japan’s National Consumer Price Index (CPI) data missed expectations. The headline CPI has landed at 4.3% lower than the consensus of 4.5% but higher than the former release of 4.0%. While the core CPI that excludes oil and food prices has matched expectations at 3.2%.

Due to a risk-off impulse, the AUD/JPY slides below the 20-day Exponential Moving Average (EMA), eyeing the intersection of the 200 and 50-day EMA at around 91.55/60.

The AUD/JPY peaked during the week at around 93.01 on Tuesday and has enjoyed a downtrend of two straight days since then. The AUD/JPY failure to break above the last week’s high of 93.03 exacerbated a downfall of 120 pips or 1.30%. Oscillators like the Relative Strength Index (RSI) is neutral, while the Rate of Change (RoC) suggests that sellers are gaining momentum. Therefore, in the near term, the AUD/JPY might print a leg-down.

The AUD/JPY first support would be the 20-day EMA at 91.75. A breach of the latter will expose the confluence of the 200 and 50-day EMA at around 91.55/60, that once cleared, would pave the way toward 91.00. The sellers’ next stop would be the February 10 daily low of 90.22.

As an alternate scenario, the AUD/JPY first resistance would be the 92.00 figure. Once broken, the AUD/JPY will threaten the February 22 daily high at 92.68, followed by 93.00.

AUDJPY to extend gains towards higher liquidity zones

Feb 25 2023

Stop Loss -1.03%

Holding time 8d10hr

91.412

Entry price

90.475

Stop loss price