Technical Bias: Neutral
Key Takeaways
“¢ Australian dollar traded higher against the Japanese yen after finding support around the 93.60-70 area.
“¢ AUDJPY pair faces a monster resistance around a previous swing zone.
“¢ AUDJPY support seen at 94.10 and resistance ahead at 94.75-90.
The Japanese yen traded lower against the Australian dollar after the release of Private Sector Credit report in Australia. However, the AUDJPY pair failed around an important resistance zone 94.80, which might result in a move lower.
Technical Analysis
The AUDJPY pair after setting a low at 93.02 climbed higher back towards the 94.60-95.00 resistance zone. There is a trend line formed on the 4 hour timeframe for the pair, which paused the upside in the pair. This trend line is coinciding with the 100 simple moving average (4H), and also represents the previous support zone which might act as a resistance in the short term. If the AUDJPY pair manages to break higher, then buyers might again struggle around an important confluence area of 200 SMA (4H) and 61.8% Fibonacci retracement level of the last major drop from the 96.10 high to 93.02 low. A break and close above the mentioned resistance zone might open the doors for a test of the previous high of 96.10.
If the AUDJPY pair fails to break higher from the current level, then it might drop back towards the 50 SMA (4H) where buyers are expected to appear again.
RBA Private Sector Credit Report
Earlier during the Asian session, the Reserve Bank of Australia released its Private Sector Credit report. The forecast was slated for a reading of 0.4%. However, the outcome was better than expected, as the total credit came at 0.5%. As a result, the Australian dollar was seen gaining bids during the late Asian session.
Overall, as long as the pair trades below the 94.80-95.00 resistance levels, then there is a chance of a move back towards the 94.00 level.
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