AUD/JPY Price Analysis: Bulls rally towards highs since early December, consolidation incoming
|- The AUD/JPY sees a promising rally, standing at 97.50, its highest since December 4.
- Indicators are riding towards overbought conditions on the four-hour chart.
- A healthy consolidation may be on the papers to correct the rally..
On Wednesday, the AUD/JPY rallied to a high of 97.60, with bulls increasing their dominance on the daily chart. However, further upside may be limited as the four-hour indicators proceed towards overbought conditions.
In consideration of the positioning of the key indicators on the daily chart, it is discernible that the bulls are in command. The Relative Strength Index (RSI) demonstrates a positive inclination within bullish territory, which indicates increasing buying power. Moreover, the Moving Average Convergence Divergence (MACD) continues its ascent, marked by swelling green bars that reinforce the ongoing bullish momentum. In addition, the overall trend also appears optimistic as the pair navigates above the 20,100,200-day Simple Moving Averages (SMAs).
Zooming into the four-hour chart, the short-term market momentum is leaning towards a possible overbought state. The stairway to overbought conditions is becoming increasingly visible, with the four-hour Relative Strength Index (RSI) demonstrating a strong surge. Concurrently, the four-hour Moving Average Convergence Divergence (MACD) underscores this buying momentum with its progressively burgeoned green bars. Yet, traders should tread carefully as these overbought conditions can often precede reversals, suggesting a possible moderation of the bullish drive in the near term.
AUD/JPY technical levels
AUD/JPY daily chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.