AUDJPY finds buyers at key support level
Australian Dollar/Japanese Yen (AUDJPY) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
AUDJPY ended Thursday at 66.45 edging higher 18 pips (0.27%). Trading up to 135 pips lower after the open, AUD/JPY managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (AUDJPY as at Mar 26, 2020):
Thursday's trading range has been 168 pips (2.54%), that's below the last trading month's daily average range of 238 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for AUDJPY.
Two candlestick patterns are matching today's price action, the Hanging Man and the Last Engulfing Top Pattern which are both known as bearish patterns.
After trading down to 64.92 earlier during the day, the FX pair bounced off the key technical support level at 65.05 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on March 17th, AUDJPY actually lost -3.41% on the following trading day. Prices are trading close to the key technical resistance level at 67.71 (R1).
Though the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the close-by swing high at 67.71 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for AUD/JPY. Out of 560 times, AUDJPY closed higher 52.86% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after eight trading days, showing a win rate of 52.32% with an average market move of 0.04%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 2.72% and NZDUSD closing 1.88% higher. On the flipside the worst performers have been USDCHF closing -1.43% lower and USDJPY losing -1.42%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPHKD surging 2.72% and GBPZAR closing 2.65% higher. The worst performers of the day have been USDMXN tanking -4.12% and USDNOK closing -3.12% lower. Read more