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Dec 20, 2014

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Home » Featured » AUD/JPY Testing 4-Month Range Resistance

AUD/JPY Testing 4-Month Range Resistance

Forex Technical Update

Previous: AUD/JPY Stalling Rally At Declining Trendline (10/18)

AUD/JPY Daily Chart 11/4/2012 8:40PM EST

AUD/JPY 11/5/2012 daily chart

Range: It depends how you define range. When looking at the daily chart, the market established a support around 79.35 since June, and you can say that it started to whip back and forth across the 200-day SMA in July. By these observations, AUD/JPY has been ranging for about 4 months. If however, you define the range to start in mid-August, the last high, then we have been ranging almost 3-months. Whichever way you see it, as we start the week (11/5 Asian session), the AUD/JPY is testing this August high, with a slight crack already from Friday (11/2).

Trendline Breakout: It should be noted that the AUD/JPY has broken above a declining trendline that goes back to the 88.61 2012-high, from 3/19. However, as we know that the breakout is in a range-bound manner and therefore needs confirmation. Clearing above 83.60 should introduce a bullish outlook and expose the 2012 high. The RSI has not been able to hit 70, since earlier in the year when the Australian dollar – Japanese yen pair was at its 2012 highs. A tag above 70 should help confirm the start of bullish momentum back toward these highs.

Target: Before the 88.61 high, a support/resistance pivot at 84.80 should be monitored for resistance and considered a short-term target for the bullish outlook. A range breakout projection (using the width of the range into the direction of the break) targets a slightly more aggressive 87.50-87.80 area.

Failure: At this point the focus is on the break from the range, but a throwback below 82.30 will dampen the bullish outlook, and a break below 81.50 puts the focus back to the range support.

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.

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