AUD/JPY Price Analysis: Ascending Triangle indicates a volatility contraction ahead


  • A formation of an ascending triangle indicates a consolidation ahead.
  • Overlapping of the 50-EMA with the cross dictates a sheer contraction in volatility.
  • Oscillation in the 40.00-60.00 range by the RSI (14) indicates that investors are awaiting a potential trigger.

The AUD/JPY pair is struggling to overstep the immediate hurdle of 94.00 in the early Asian session. The cross is displaying a lackluster performance broadly due to the absence of key triggers for decisive action.  Meanwhile, the market sentiment is extremely positive as US yields are facing immense pressure led by rising odds of a slowdown in the rate hike pace by the Federal Reserve (Fed).

On Thursday, Japanese markets will open after a close on Wednesday on account of Thanksgiving Day. Therefore, volatility could be immense as investors will look to manage their positions accordingly.

On an hourly scale, the cross is auctioning in an Ascending Triangle chart pattern, which indicates a sheer decline in volatility. The horizontal resistance of the above-mentioned chart pattern is placed from November 18 high at 94.10 while the upward-sloping trendline is plotted from Monday’s low at 93.19.

The 50-period Exponential Moving Average (EMA) at 93.87 is overlapping with the asset’s price, which indicates a consolidation ahead.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range, which states the unavailability of a potential trigger for making an informed decision.

For an upside move, the asset is needed to violate Wednesday’s high at 94.14, which will send the cross towards November 16 high at 94.66 and the round-level resistance of 95.00.

Alternatively, a breakdown of the chart pattern if the asset drops below Tuesday’s low at 93.57, will expose the cross for further downside towards Monday’s low at 93.19 followed by November 11 low at 92.60.

AUD/JPY hourly chart

AUD/JPY

Overview
Today last price 93.97
Today Daily Change 0.13
Today Daily Change % 0.14
Today daily open 93.84
 
Trends
Daily SMA20 94.15
Daily SMA50 94.03
Daily SMA100 94.28
Daily SMA200 92.46
 
Levels
Previous Daily High 94.02
Previous Daily Low 93.57
Previous Weekly High 94.66
Previous Weekly Low 92.92
Previous Monthly High 95.75
Previous Monthly Low 90.84
Daily Fibonacci 38.2% 93.85
Daily Fibonacci 61.8% 93.74
Daily Pivot Point S1 93.6
Daily Pivot Point S2 93.36
Daily Pivot Point S3 93.15
Daily Pivot Point R1 94.06
Daily Pivot Point R2 94.27
Daily Pivot Point R3 94.51

 

 

 

 

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