AUD/JPY Price Analysis: Flirting with head-and-shoulders support

AUD/JPY's daily chart shows a head-and-shoulders bearish pattern.
Dovish RBA expectations favor breakdown and deeper losses.

Omkar Godbole FXStreet Contributor

AUD/JPY is currently trading largely unchanged on the day near 74.43, having put in a low of 74.21 early Wednesday.

A convincing close below 74.43 would confirm a head-and-shoulders breakdown or a bearish reversal pattern on the daily chart and open the doors to 70.40 (target as per the measured move method).

A breakdown looks likely as the second wave of the coronavirus cases is accelerating across Europe and in the US and is weighing over the risk assets. More importantly, it's threatening to derail the global economic recovery. As such, the better-than-expected Aussie third-quarter consumer price index (CPI) inflation released early Wednesday is unlikely to deter the RBA from cutting rates next month.

That said, the bearish case for AUD/JPY would weaken if the pair finds acceptance above 75.00. In that case, the focus would shift to 76.52 (Oct. 9 high).

Daily chart

Trend: Bearish

Technical levels

XAU/USD

Overview
Today last price	1905.58
Today Daily Change	-2.22
Today Daily Change %	-0.12
Today daily open	1907.8

Trends
Daily SMA20	1903.35
Daily SMA50	1919.51
Daily SMA100	1885.35
Daily SMA200	1765.35

Levels
Previous Daily High	1911.46
Previous Daily Low	1897.92
Previous Weekly High	1931.54
Previous Weekly Low	1894.48
Previous Monthly High	1992.42
Previous Monthly Low	1848.82
Daily Fibonacci 38.2%	1906.29
Daily Fibonacci 61.8%	1903.09
Daily Pivot Point S1	1899.99
Daily Pivot Point S2	1892.19
Daily Pivot Point S3	1886.45
Daily Pivot Point R1	1913.53
Daily Pivot Point R2	1919.27
Daily Pivot Point R3	1927.07

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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