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AUD/JPY: phase of consolidation at 3 year lows here?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 11, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - AUD/JPY has been making recovery attempts up to meet the 4hr 20 sma at 82.56, but has failed yet again to convince on the break with supply and risk aversion punishing the cross back down and contained in the steep descending channel.

    The Yen has been the best performer in these conditions and lost the 117 handle overnight, albeit momentarily, to print new lows for the 4.5 months since late August business last year. The Aussie has also been pressured in a similar fashion and too has made fresh lows since Sep 2015 business. This has left the cross to trade at multi month lows and at the lowest point since Sep 2012, testing the 200 month SMA at 81.35 having marked a low through that and below the 81 handle to 80.88.

    For today, there is little in the way of supportive fundamentals out there for the Aussie currently and the market is waiting for fresh impetus. This week comes with the Aussie jobs data after China trade balance. At this stage, however, most of the shock has been positioned into the price and it might take something more catastrophic to propel the cross lower further in such a steep channel as last week, while a period of consolidation might be on the cards should data only continue to disappoint marginally beyond expectations.

    AUD/JPY levels

    Should the August lows of 2015 in USD/JPY at 116.07 give way, the cross is destined to find lower grounds, remaining below the 200 month SMA at 81.34. 0.7939, the 3rd Oct 2012 weekly stick lows come as next key downside target. A retracement back to the upside needs to overcome 88.00 if it is to find a neutral stance on a daily outlook.
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