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  • AUD/JPY bulls catch a breather around multi-month top marked last week.
  • Sustained bounce off 10-day SMA, two-month-old ascending trend channel favor bulls.
  • Confluence of rising trend line from June, channel’s resistance line will be the tough nut to break for buyers.

AUD/JPY recedes to 80.60 during the early Asian trading session on Wednesday. In doing so, the quote steps back from extending the previous day’s upside momentum after initially teasing Friday’s top, also the highest level since December 2018, as RSI conditions turn overbought.

Although RSI conditions suggest a 10-day SMA re-test, at 80.10 now, the 80.00 theshold and support line of an upward sloping channel since the mid-November, currently around 79.60, will test the AUD/JPY sellers afterward.

Should the bears manage to conquer 79.60 support, the 79.00 and the early December tops near 78.80 will act as intermediate supports ahead of highlighting August month’s top near 79.45.

Meanwhile, a convergence of an ascending trend line from June 05 and the upper line of the stated channel, around 81.25-30, becomes the key resistance to break for the AUD/JPY buyers.

In a case where AUD/JPY bulls dominate past-81.30, a high marked on December 13, 2020, close to 82.20, will be in the spotlight.

AUD/JPY daily chart

Trend: Pullback expected