Both the yen and the aussie are taking a battering in Asia, but the latter has been hit even harder than the former. This has pushed AUDJPY to a support zone around the base of its daily Ichimoku cloud. While this in itself isn’t much to get excited about, some other technical indicators are giving off some interesting signals.
In the long-term, we cannot rule out further losses in AUDJPY, at least not at the moment. Daily RSI and MACD remain firmly in bearish territory and suggest that the path of least resistance remains to the downside. In saying that, price isn’t looking as bearish as it once was.
Short-term strength?
Over shorter time frames the pair is actually looking somewhat bullish. There is a bullish divergence between hourly RSI and price. Also, the hourly stochastic momentum index may be signalling that momentum is shifting to the upside, although this isn’t confirmed yet.
Overall, it appears that the pair may find some short-term strength if it can hold onto this support zone around the base of its daily Ichimoku cloud. However, a recent fall in AUDUSD through another important short-term support zone is slightly concerning. Yet, this can largely be attributed to USD strength, as opposed to outright aussie weakness.
AUDJPY – Daily
Source: FOREX.com
Recommended Content
Editors’ Picks
EUR/USD stays in tight channel above 1.0750
EUR/USD continues to fluctuate in a narrow band slightly above 1.0750 after posting small gains on Monday. Disappointing Factory Orders data from Germany limits the Euro's gains as investors keep a close eye on comments from central bankers.
GBP/USD retreats below 1.2550 as USD recovers
GBP/USD stays under modest bearish pressure and trades below 1.2550 in the European session on Tuesday. The cautious market stance helps the USD hold its ground and doesn't allow the pair to regain its traction. The Bank of England will announce policy decisions on Thursday.
Gold price turns red below $2,320 amid renewed US dollar demand
Gold trades in negative territory below $2,320 as the souring mood allows the USD to find demand on Tuesday. Nevertheless, the benchmark 10-year US Treasury bond yield stays below 4.5% and helps XAU/USD limit its losses.
Ripple lawsuit develops with SEC reply under seal, XRP holders await public redacted versions
Ripple lawsuit’s latest development is SEC filing, under seal. The regulator has filed its reply brief and supporting exhibits and the documents will be made public on Wednesday, May 8.
The impact of economic indicators and global dynamics on the US Dollar
Recent labor market data suggest a cooling economy. The disappointing job creation and rising unemployment hint at a slackening demand for labor, which, coupled with subdued wage growth, could signal a slower economic trajectory.