AUD/JPY Continues to Trade Within Descending Channel

AUD/JPY remains confined within a descending channel as it no longer responds to the positive slope in the 50-Day SMA (94.71), but the exchange rate may attempt to retrace the decline from the start of the month as it halts a four-day selloff.

AUD/JPY Rate Outlook

AUD/JPY seems to be reversing ahead of channel support as it snaps the series of lower highs and lows from last week, and the failed attempts to close below the 93.10 (38.2% Fibonacci extension) region may lead to a larger rebound in the exchange rate as it holds above the monthly low (92.97).

A break/close above the 93.90 (61.8% Fibonacci retracement) to 94.40 (23.6% Fibonacci retracement) area may push AUD/JPY back above the moving average, with a move above channel resistance opening up the 95.30 (50% Fibonacci extension) to 96.10 (78.6% Fibonacci retracement) area.

However, a close below the 93.10 (38.2% Fibonacci extension) region may lead to a test of the July low (91.80), with a break/close below 91.70 (38.2% Fibonacci retracement) bringing the June low (90.30) on the radar.