Today, AUD/JPY rejected the 77.00 psychological resistance area for the 4th consecutive time, implying the importance of this supply zone. Moving back to November 18th, AUD/JPY broke below the critical level, which is 75.79. This is the level where AUD/JPY rejected the simple uptrend trendline as well as the 50 Exponential Moving Average, which occurred on November 13th, where a new bullish Fibonacci cycle has started. However, a break below the 75.79 support confirmed the breakout of the uptrend trendline and invalidated the bullish cycle.
Such price action suggested a medium to long term price weakness, which current upside correction might be extremely attractive for sellers. This is because of multiple rejections of the 77.00 resistance area, as well as the beginning of the new Fibonacci cycle, which started on November 25th.
Therefore, as long as 4h and/or daily closing price remains below 77.10, which is the most recent high, AUD/JPY must be expected to initiate a corrective move to the downside. This could result in a price drop of nearly 200 pips, based on Fibonacci support.
Altogether, there are 3 Fibonacci indicators applied to this chart. First was applied to the corrective move down, back on November 4th. It shows 3 support levels, namely 75.30, 75.16, and 74.92, which correspond to 88.6%, 78.6%, and 61.8% Fibonacci retracement levels. Another Fibonacci was applied to the most recent correction, which took place between 19-30 November. It shows that 127.2% Fibs corresponds exactly tot the 61.8% Fibs at 74.92, and Finally, another Fibs was applied to the current corrective move up, after price broke below the 50 EMA on the hourly chart. It shows that 727.2% Fibs also corresponds exactly to the 74.92 support, making it potentially a strong demand area.
As long as the current resistance is being respected, AUD/JPY will initiate the downside correction, towards the 75.30 - 74.92 support area. But if it breaks to the upside, the long-term uptrend should be expected to continue.
Key support levels: 76.45, 75.30, 75.16, 74.92
Key resistance levels: 77.95, 77.10
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
Such price action suggested a medium to long term price weakness, which current upside correction might be extremely attractive for sellers. This is because of multiple rejections of the 77.00 resistance area, as well as the beginning of the new Fibonacci cycle, which started on November 25th.
Therefore, as long as 4h and/or daily closing price remains below 77.10, which is the most recent high, AUD/JPY must be expected to initiate a corrective move to the downside. This could result in a price drop of nearly 200 pips, based on Fibonacci support.
Altogether, there are 3 Fibonacci indicators applied to this chart. First was applied to the corrective move down, back on November 4th. It shows 3 support levels, namely 75.30, 75.16, and 74.92, which correspond to 88.6%, 78.6%, and 61.8% Fibonacci retracement levels. Another Fibonacci was applied to the most recent correction, which took place between 19-30 November. It shows that 127.2% Fibs corresponds exactly tot the 61.8% Fibs at 74.92, and Finally, another Fibs was applied to the current corrective move up, after price broke below the 50 EMA on the hourly chart. It shows that 727.2% Fibs also corresponds exactly to the 74.92 support, making it potentially a strong demand area.
As long as the current resistance is being respected, AUD/JPY will initiate the downside correction, towards the 75.30 - 74.92 support area. But if it breaks to the upside, the long-term uptrend should be expected to continue.
Key support levels: 76.45, 75.30, 75.16, 74.92
Key resistance levels: 77.95, 77.10
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.