AUD/JPY: risk-off keeps downside in vouge; 0.72 wide-eyed

FXStreet (Guatemala) – AUD/JPY has been a tug of war in the lows between the bears and bulls protecting the key downside support of 0.7920, a break of which would expose a new leg towards 2011 lows on the 0.72 handle.

The Aussie has been a gradual decline since 2013 that has accelerated this year in the wake of the Chinese crisis and has dropped away significantly from the 20 week sma at 0.7137. At the same time, the Yen has been favoured for its safe haven status, just recently making fresh highs vs the greenback of 115.96, throwing the cross into a downward spiral. As uncertainty keeps a hold, the downside is favoured in this pair as a barometer of risk in the market.

AUD/JPY levels

Technically, AUD/JPY ha sprinted new lows at 79.23. A recovery back to the 4hr 50 sma at 81.46 is required if the cross is going to sustain a recovery back towards the 100 sma on the same time frame at 83.56, a level where the cross has been resisted a number of times on recovery attempts in the downtrend from 88.00. While the cross remains below the 200 week sma at 81.34, the downside is favoured towards Sep 201 lows of 0.7204.

AUD/JPY has been a tug of war in the lows between the bears and bulls protecting the key downside support of 0.7920, a break of which would expose a new leg towards 2011 lows on the 0.72 handle.

(Market News Provided by FXstreet)