AUD/JPY Price Analysis: Braces for a yearly high near 95.00 ahead of RBA
|- AUD/JPY grinds higher at six-week top after crossing a horizontal hurdle since late March.
- Bullish MACD, resistance break directs buyers towards the yearly peak but RSI has limited room before turning overbought.
- RBA is likely to hike the benchmark interest rate by 25 basis points (bps).
AUD/JPY edges higher around the highest levels since late April, after crossing the 2.5-month-old horizontal hurdle. That said, the cross-currency pair dribbles near 94.90 as traders prepare for the Reserve Bank of Australia’s (RBA) second rate hike, widely expected to be of 0.25%.
Also read: Reserve Bank of Australia Preview: Rate hikes are here to stay
In addition to the pair’s successful break of horizontal resistance, now support around 94.30-40, bullish MACD signals also keep AUD/JPY buyers hopeful.
However, the RSI (14) speedily approaches the overbought territory, suggesting limited upside room for the AUD/JPY prices.
Hence, the pair’s run-up beyond the yearly peak of 95.75 appears difficult, unless the RBA offers a major positive surprise.
Should the quote manage to rise past 95.75, its run-up towards the May 2015 high surrounding 97.30 can’t be ruled out.
Meanwhile, pullback moves need to break the 94.30 support to convince sellers. Even so, 50-DMA and an ascending support line from May 12, respectively around 92.10 and 91.60, could challenge the AUD/JPY bears.
Following that, the pair sellers may aim for the 90.00 psychological magnet ahead of challenging the 38.2% Fibonacci retracement of December 2021 to April 2022 upside, around 89.30.
AUD/JPY: Daily chart
Trend: Limited upside expected
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