AUD/JPY Price Analysis: Bulls persist, pair firmly above 107.00
|- AUD/JPY extends its gains, reaching new highs past 107.00 on Friday.
- Indicators hint at possible downward correction due to overbought conditions.
On Friday, the AUD/JPY pair continued its uptrend, achieving new highs beyond 107.00, surpassing yet again its 2013 high levels.
On a daily scale, the Relative Strength Index (RSI) of the AUDJPY has spiked to 74 from 65 last Thursday. This sharp increase signals a strengthening bullish momentum but simultaneously places the pair in an overbought position, which might incite a downward correction. The Moving Average Convergence Divergence (MACD) shows a continuation of the rising green bars, indicating that the bullish momentum remains strong however an adjustment might be on the horizon due to overbought conditions.
AUD/JPY daily chart
On the broader outlook, the AUD/JPY pair demonstrates persistent bullish trends, which is reinforced by its position above the 20-day, 100-day, and 200-day Simple Moving Averages (SMAs). However, traders should monitor the pair for potential corrections, given the more pronounced indicators for overbought conditions.
If the pair encounters a correction driving it below the 107.00 level, followed by the 106.00 level, it may find new support lines. Thus, the 104.90 (20-day SMA) level might serve as a potential support line. Meanwhile, buyers will explore uncharted territory should the pair persist in its current trend and surpass the 107.50 level.
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