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AUDJPY Trashed, Looks Set For More Losses

Key Points

  • Aussie Dollar dived against the Japanese Yen, and traded below a major support trend line on the daily chart.
  • The AUDJPY pair has created a monster bearish candle today, signaling sellers are in control.
  • Australian RBA Commodity Price SDR released by the Reserve Bank of Australia posted a decline of 23.3% in December 2015, compared with the same month a year ago.
  • Japanese Nikkei Manufacturing PMI posted an increase from the last reading of 52.5 to 52.6 in December 2015.

Technical Analysis

The AUDJPY pair simply collapsed during the Asian session today. There was a major support trend line formed on the daily chart, which was cleared by sellers to ignite a bear rally. The pair even settled below the 100 and 50-day simple moving averages.


The pair is currently testing the 61.8% Fib retracement level of the last wave from the 82.12 low to 90.75 high, and if it is breached a move towards the 76.4% Fib level is possible.

On the upside, the broken trend line may act as a resistance moving ahead along with the 100-day SMA.

Nikkei Manufacturing PMI

Today, the Japanese Nikkei Manufacturing PMI, which gives an early snapshot of the health of manufacturing sector in Japan was published. The market was not expecting any major increase in the PMI. However, the result was different, as there was a minor increase from the last reading of 52.5 to 52.6 in December 2015.

The risk sentiment was the main theme today that acted as a catalyst and caused nasty moves during the Asian and London session.

The AUDJPY pair is under a lot of bearish pressure, and if sellers remain in action, then there is a chance that the pair may test the 85.00 level in the short term.

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