Aside from the bullish signature taken from a 4hr chart, where the 50- and 200-period moving averages are well distanced from each other, this overextended upward movement can be seen as an opportunity to lighten up positions.

A recent rip higher in the spot rate has pushed the RSI above the 75% level. In Elliott terms, this technical event is often associated with 5th waves, prior to the development of a corrective phase. The AUD/JPY spot would have to gravitate towards the 50 SMA at a minimum to alleviate immediate upside pressures.

AUD/JPY RSI warns of a completion of an impulsive wave

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By FXOpen