AUD/JPY Price Analysis: Faces resistance around 91.00, with downside risks lingering
- AUD/JPY rallies for three straight days, though tests solid resistance at around 91.00.
- Three daily closes above the 200-day EMA would cement the AUD/JPY uptrend.
- Downside risks remain if AUD/JPY drops below 91.00, which could exacerbate a fall toward 90.00.
The AUD/JPY climbed above the 91.00 figure following the Bank of Japan’s (BoJ) decision last Friday to hold rates unchanged while maintaining its Yield Curve Control (YCC). Therefore, the AUD/JPY has gained since then 3.04%. As the Asian session begins, the AUD/JPY is trading at 91.14.
AUD/JPY Price Action
After clearing the latest cycle high achieved on April 20 at 90.78, the AUD/JPY extended its gains, breaking a downslope resistance trendline drawn from September 2022 highs of around 98.60. in addition, the 200-day Exponential Moving Average (EMA) at 90.75 was cleared, suggesting that the bearish bias is negated in the near term. To cement the bullish bias, the AUD/JPY must achieve three daily closes above the 200-day EMA. Once done, that could pave the way for further upside.
If AUD/JPY breaks above the January 9 daily high at 91.82, the 92.00 figure is up for grabs as buyers prepare to challenge the YTD high at 92.99.
However, if AUD/JPY tumbles below 91.00, a reversal toward the 200-day EMA at 90.75 is on the cards. If the May 1 low at 90.01 is compromised, a bearish engulfing candle pattern could form and, alongside the 200-day EMA, it could trigger a trend reversal that can challenge the YTD lows.
The next support would be the 50-day EMA at 89.71, immediately followed by the 20-day EMA at 89.64.
AUD/JPY Daily Chart
Author
Christian Borjon Valencia
FXStreet
Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.
