AUD/JPY Shows modest gains, suggesting optimistic momentum

Highlights:

• The AUD/JPY cross has dropped to the 96.35 level after a 0.46% gain, with a bullish harami pattern indicating potential upward momentum.
• Buyers are targeting the January 2nd high of 96.71 and the 97.00 level, with subsequent resistance at 97.67 and 98.00.
• If the upside is capped, sellers could target the Senkou Span B at 96.14 and the Kijun Sen at 95.90, with 94.58 as further support.

The AUD/JPY saw modest gains of 0.46% on Wednesday, although it starts Thursday’s session lower, trading below yesterday’s close of 96.42. However, buyers regained the Kijun-Sen and entered around the bottom of the Ichimoku cloud (Kumo), opening the door for further gains. As of this writing, the pair is trading at 96.35, 0.07% lower.

AUD/JPY Price Chart

The daily chart shows the pair trading in a range-bound manner, although the formation of a ‘bullish harami’ candlestick pattern may pave the way for further upward movement. Buyers will need to clear the January 2nd high of 96.71 followed by the 97.00 level for a bullish resumption. The next resistance level would be the June 19th high at 97.67 once these two levels are cleared. The psychological level of 98.00 would be next.

If the AUD/JPY rally is capped above 96.71, sellers could step in and drag prices towards the Senkou Span B at 96.14, followed by the Kijun Sen at 95.90. Once there, the next area of demand to test would be the 14th of December low of 94.58.