AUD/JPY Price Analysis: Upwards momentum wanes, consolidation to continue
- The daily RSI increase denotes a slight uptick in momentum.
- Signs of bullish fatigue emerge after renewed gains, reinforcing the ongoing consolidation outlook.
- The pair currently focuses on the stronghold of the 20-day SMA around the 103.80 area which acts as a resistance.
In Wednesday's trading session, the AUD/JPY pair bounced to 103.80, reflective of a resurgence in upward momentum. However, the buyers met resistance at the 20-day Simple Moving Average (SMA) and retreated.
According to the daily Relative Strength Index (RSI) analysis, the index increased to 52 from the previous session's 46, demonstrating a gain in momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) prints flat red bars, indicating steady selling traction.
AUD/JPY daily chart
On the downside, further losses will find the 100 and 200-day SMAs at their disposal as shielding units. On the other hand, buyers will encounter resistance trying to propel the pair back above the 20-day SMA at 103.80 and further to the 105.00 mark. If these resistance points remain intact, the market could witness the AUD/JPY pair maintain a consolidation phase.
What is not in discussion, is that the cross has entered a consolidation phase, following an aggressive rally that took it to multi-year highs.
Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
