By: Mike Kulej
The Australian Dollar appears to be no longer the dominant currency from just couple of weeks ago. It has retreated from the all time high against the US Dollar and slipped in relation to most other active currencies. The AUD-JPY pair is no exception.
Unlike other Aussie crosses, the AUD-JPY has been moving much slower, but that could be changing. On the intermediate term chart, we can see a prolonged tight trading range in December, which now takes on a shape of a rounded top. Starting in January, this pair became more active making lower lows as the time goes on.
This down trend could accelerate if the next support is broken. At 81.89, the price is within a striking distance of latest low of 81.51. Chances are that if the AUD-JPY moves under that level, the bearish trend will strengthen and become faster.
It seems that some technical indicators “anticipate” this possibility. The ADX has already turned up, supporting the downtrend, while the Momentum Indicator has moved sharply lower, in line with the price itself. With this confirmation, the AUD-JPY could be set for a test of the 79.75 lows, if it moves under the current support.