AUD/JPY upside correction could have ended, opening a 200 pip downside potential

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Updated: 07 October 2020

Hello traders! AUD/JPY trend is clearly bearish, especially after the breakout of the 50 and 200 Exponential Moving Average as well as lower lows and lower highs pattern.

The most recent rejection of the 50 EMA along with the simple downtrend trendline shows strong selling pressure, which is likely to result in the downtrend continuation.

Today AUD/JPY is rejecting the average-price downtrend trendline, which means that downtrend could be starting extremely soon, but only if the price will remain below the trendline. However, if there will be a 4h close above 75.70, the pair might re-test the simple downtrend trendline before/if the downtrend continues.

All-in-all, the trend remains bearish and the price could be heading towards the 73.53 support, which is confirmed by two Fibonacci retracement levels. These are 23.6% and 327.2% Fibs as per the chart in this analysis

Bias: Strongly bearish while below 76.16

Potential Resistance Zone: 75.60 – 76.00

Potential Targets: 73.73

Have a profitable trading!