AUDJPY – Aussie Dollar Establishing Downtrend Vs Japanese Yen20 December, 2016 by Aayush Jindal in Fundamental Analysis, Market Analysis, Technical Analysis
AUDJPY – Aussie Dollar Establishing Downtrend Vs Japanese Yen
- The Aussie dollar traded sharply lower against the Japanese yen, and broke the 86.00 support.
- There was a crucial bullish trend line on the 4-hours chart of AUDJPY, which was broken at 85.80 to ignite a downside move.
- In Australia today, the minutes of the Reserve Bank of Australia meetings were published, which failed to help the Aussie dollar.
- Later today in Japan, the BoJ Interest Rate Decision will be announced by the Bank of Japan, which could impact the Japanese yen in the short term.
AUDJPY Technical Analysis
The Aussie dollar after trading as high as 87.53 against the Japanese yen found sellers, and traded sharply lower. The AUDJPY traded down, and broke a crucial support area at 86.00 to pave the way for more losses.
During the downside move, the pair broke a couple of important support areas like a critical bullish trend line on the 4-hours chart. Moreover, there was even a close below the 50% Fib retracement level of the last wave from the 83.77 low to 87.53 high.
Looking at the current H4 chart, it looks like the Aussie dollar has established a downtrend versus the Japanese yen and may trade towards 84.50. The H4 RSI is also well below the 50 level, which is a bearish sign for AUDJPY and calling for more declines. The last important point is that the pair is also below the 100 simple moving average on the same chart, which is currently acting as a resistance. So, it looks like the AUDJPY pair has settled below a major support area.
RBA Meeting Minutes
Earlier during the minutes of the Reserve Bank of Australia meetings were published. There was nothing much in the report. As a result, the Aussie dollar remained under a bearish pressure.
BoJ Interest Rate Decision
In an hour, the BoJ Interest Rate Decision will be announced. It is an important event, and may ignite moves in the Japanese yen. The market is aligned for no change in the interest rates from -0.10%.
Let us see how the event shapes up and impacts the JPY going forward. If you are looking to trade the yen around the stated event, then manage your stops well and trade safe.