AUD/JPY Price Analysis: Pair bounces back from 86.00 level as risk sentiments improve

AUD/JPY finds support as global banking liquidity crisis eases.
Fading Japanese Yen safe-haven demand provides relief to AUD/JPY.
RSI signals oversold conditions, suggesting a potential pullback.

The risk proxy AUD/JPY has fallen sharply after reaching the March high near the 92.00 psychological mark on a daily timeframe, as demand for the safe-haven Japanese Yen surged amid the global banking liquidity crisis.

Investors have returned to traditional safe-haven assets like the Yen instead of the US Dollar during this banking crisis, although recent efforts to alleviate the liquidity crunch have diminished the Yen's demand somewhat.

The risk-sensitive AUD/JPY pair bounced back after finding support and registering a new March low at the key psychological level of 86.00, which also intersects the multi-year ascending trendline starting from 2020. This level is likely to be the last line of support before entering uncharted territory.

Any upside gains are expected to be limited around the current quote price, with a multi-month tested support-turned-resistance at the 87.53 mark. The 21-Day Moving Average (DMA) and 50-DMA crossover is also exerting downward pressure on the pair. A convincing break above the 87.53 mark will face challenges from both DMAs sequentially.

Key resistance is placed at 90.86, followed by 2023 high at 93.17.

The Relative Strength Index (RSI) signals an oversold condition, suggesting that a pullback in the pair may be due.

AUD/JPY: Daily chart

EUR/USD looks sidelined around 1.1850

EUR/USD remains on the back foot, extending its bearish tone and sliding towards the 1.1850 area to print fresh daily lows on Monday. The move lower comes as the US Dollar gathers modest traction, with thin liquidity and subdued volatility amplifying price swings amid the US market holiday.

GBP/USD flirts with daily lows near 1.3630

GBP/USD has quickly given back Friday’s solid gains, turning lower at the start of the week and drifting back towards the 1.3630 area. The focus now shifts squarely to Tuesday’s UK labour market report, which is likely to keep the quid firmly in the spotlight and could set the tone for Cable’s next move.

Gold loses momentum, eases below $5,000

Gold is giving back part of Friday’s sharp rebound, deflating below the key $5,000 mark per troy ounce as the new week gets underway. Modest gains in the US Dollar are keeping the metal in check, while thin trading conditions, due to the Presidents Day holiday in the US, are adding to the choppy and hesitant tone across markets.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.