- The Australian dollar trimmed some losses as the market sentiment improved.
- US Republican Senator Mitch McConnell offered a short-term solution to the debt-ceiling, improving the sentiment.
- From a technical perspective, the AUD/JPY is in consolidation around 81.00.
The AUD/JPY is sliding for the first day out of five days advancing, is down 0.05%, trading at 81.06 at the time of the writing.
The market sentiment is slightly upbeat, as good news about the US debt ceiling hit the wires. The US Republican Senator Mitch McConnell offered a short-term debt limit increase that would last through November. Once the news hit the wires, the major US stock indices rose to finish the day in the green, gaining between 0.30% and 0.63%. Also, risk-sensitive currencies, like the Australian and New Zealand dollar, got a boost trimming some losses as the New York session end approached.
AUD/JPY Price Forecast: Technical outlook
Daily chart
The AUD/JPY spot price is trapped between the 50 and the 100-day moving averages (DMA’s), acting as support and resistance, respectively.
For AUD/JPY buyers to resume the uptrend, they will need a daily close above 81.41. in case of that outcome, the first resistance level would be the confluence of September’s three high and the 100-DMA around the 81.90 - 82.02 range. A breach of the latter would expose the 200-DMA at 82.31.
On the other hand, for AUD/JPY sellers to regain control, they need a daily close below the 50-DMA at 80.46. in case of that outcome, the first support level would be October’s first low at 79.90. A breach of that level, a move towards 77.89, is on the cards, but September’s 23 low at 78.84, would be on the way.
The Relative Strength Index (RSI) is at 55, flattish, suggesting that consolidation might lie ahead.
KEY ADDITIONAL LEVELS TO WATCH
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