AUD/JPY Price Analysis: Retreats on global recession risks, Fed tightening
- AUD/JPY experiences a plunge due to rising risk aversion; global business indicators hint at a potential slowdown.
- Despite an upward medium-term bias, the pair could extend its pullback towards the Senkou Span A level at 95.19.
- Key resistance levels are at the Tenkan-Sen line at 95.99 and the year-to-date high at 97.67.
AUD/JPY plunges due to risk aversion, as solid data from the United States (US) increased the odds for further tightening by the US Federal Reserve (Fed). That, alongside worldwide business activity indicators showing signs of slowing down, ignited recession risks. The AUD/JPY is trading at 95.44, down 0.83%.
AUD/JPY Price Analysis: Technical outlook
The AUD/JPY remains upward biased from a medium-term perspective, though the ongoing pullback could extend toward the Senkou Span A at 95.19. If AUD/JPY slides below that level, the cross-currency pair would test the 95.00 psychological level. A breach of the latter will expose the Kijun-Sen line at 94.39, followed by the 94.00 figure.
If AUD/JPY aims toward 95.00 and bounces off that level, the first resistance would be the Tenkan-Sen line at 95.99. If that level is surpassed, the AUD/JPY first resistance would be 97.00. Once broken, the next ceiling level would be the year-to-date (YTD) high at 97.67.
AUD/JPY Price Action – Daily chart
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
