Forex market today: AUD/JPY Price Forecast

AUD/JPY Price Forecast: the AUD/JPY currency pair is currently experiencing fluctuations, and its price forecast indicates a mix of potential support and resistance levels.

As of Wednesday, during Asian trading hours, the AUD/JPY currency pair is trading around 93.60, marking its second consecutive day of gains. Despite this positive movement, a technical analysis of the daily chart indicates that the pair remains trapped within a descending channel, pointing to a prevailing bearish sentiment in the market.

AUD/JPY Price Technical Analysis

Bearish Bias
The current price action suggests a sustained bearish bias for AUD/JPY. The 14-day Relative Strength Index (RSI) is positioned above the 30 level, reinforcing the notion of underlying weakness. Additionally, the pair continues to trade below the nine-day Exponential Moving Average (EMA), which indicates a lack of short-term price momentum.

Key Support Levels
Traders are closely monitoring key support levels for the AUD/JPY currency pair. The initial psychological support is an important threshold that, if breached, could lead to further declines. Should this level fail to hold, the next significant barrier may be the lower boundary of the prevailing descending channel. A decisive break below this channel would likely reinforce the bearish sentiment and could drive the pair toward a notable low not seen in some time. Such movements would indicate increased selling pressure and could prompt traders to reassess their positions in light of this bearish outlook.

Resistance Levels
On the upside, the initial resistance level to monitor is the nine-day Exponential Moving Average (EMA). A breakout above this level could indicate a shift in momentum, potentially leading to a rally toward the upper boundary of the descending channel, which represents a significant psychological level. Such movements could signal a stronger bullish trend, encouraging further buying interest in the market. Traders should remain vigilant for signs of momentum shifts as these levels are approached.

AUD/JPY Market Sentiment and Influences

The overall sentiment in the forex market remains cautious, with several factors influencing the AUD/JPY currency pair.

Economic Conditions
Economic indicators from both Australia and Japan will play a crucial role in shaping market expectations. If Australia reports stronger economic data, such as employment figures or consumer spending, it could bolster the Australian dollar. Conversely, weaker data from Japan or escalating economic challenges could further undermine the yen, impacting the AUD/JPY exchange rate.

Competitive Landscape
In the context of global forex trading, the Japanese yen has been showing strength against other major currencies. Recent data indicates that the yen is performing well against the Swiss Franc and other currencies, adding complexity to the AUD/JPY dynamics. Traders should remain aware of these inter-market correlations as they could influence the pair's future movements.

Geopolitical Factors on AUD/JPY
Geopolitical developments play a significant role in influencing currency markets, including the AUD/JPY exchange rate. Tensions or agreements between Japan and Australia can directly affect investor sentiment. For instance, trade negotiations, diplomatic relations, or security partnerships can lead to fluctuations in currency values. If Japan and Australia strengthen their economic ties through trade agreements, it may bolster the Australian dollar as investors anticipate increased economic activity.

Conversely, any geopolitical tensions, such as disputes over trade policies or regional security issues, can create uncertainty and prompt investors to favor safer assets, potentially weakening the AUD against the JPY. Additionally, shifts in global trade dynamics, influenced by factors like economic sanctions or changes in commodity prices, can further impact the AUD/JPY pair. Given that Australia is a major exporter of commodities and Japan relies on these imports, changes in global supply chains or trade relationships can lead to significant fluctuations.

Conclusion

The AUD/JPY currency pair is currently navigating a complex landscape characterized by a bearish bias and significant technical levels. As it trades around 93.60, traders should closely monitor support and resistance levels while considering broader economic and geopolitical factors that could influence price movements.

While the immediate outlook suggests a cautious approach, potential breakouts above key resistance levels could signal a change in sentiment. Conversely, failure to hold above significant support could lead to further declines. Overall, staying informed about economic developments and market trends will be crucial for traders looking to navigate this currency pair effectively.

When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.