AUD/JPY Price Analysis: Holds to gains post RBA as technicals support further upside
|- AUD/JPY sees a sharp rally, buoyed by RBA’s surprise rate hike to 4.10%; the pair trades flat above 93.00.
- The technical analysis projects a bullish bias, with key resistance at the December 19 high of 93.35.
- Risk aversion could trigger pullback, with initial support found at the May 19 high of 92.35.
AUD/JPY rallied sharply on Tuesday after the Reserve Bank of Australia (RBA) surprisingly raised rates by 25 bps, lifting the cash rate to 4.10%. Therefore, the AUD/JPY jumped from 92.30, toward 93.14, before retracing some of those gains, but buyers moving in, lifted the AUD/JPY toward the current spot price. At the time of writing, the AUD/JPY is trading at 93.14, flat as the Asian session begins.
AUD/JPY Price Analysis: Technical outlook
After rallying sharply, the AUD/JPY remains upward biased, as it sits above the Ichimoku Cloud and the Chikou Span. Additionally, the Tenkan-Sen line is above the Kijun-Sen line, each at 91.76 and 91.21, respectively, another bullish signal. Nevertheless, the nature of the cross-currency pair indicates that its subject-to-market sentiment swings, which could shift the pair’s direction.
The Relative Strength Index (RSI) indicator and the 3-day Rate of Change (RoC) further cement the bias, as the RSI sits in bullish territory, while the RoC indicates buyers remain in charge.
Therefore, the AUD/JPY first resistance would be the December 19 high at 93.35. A breach of the latter will expose a top-trendline of an ascending channel at around 93.70/85 before challenging the 94.00 figure.
In the event of risk aversion, the AUD/JPY pair may be subject to a pullback, and the first support would be the May 19 high at 92.35 before diving to the 92.00 figure. Once cleared, the next support would be the Tenkan-Sen line at 91.76, ahead of sliding toward the Kijun-Sen line at 91.21.
AUD/JPY Price Action – 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.