AUD/JPY continues to trade within a wide range since the beginning of this year. The levels that the pair is trading between are the 77.40 zone on the downside and the 79.85 hurdle on the upside. But lately, from the end of March, the rate was spotted to be climbing higher towards the upper bound of that range, trading above a short-term upside support line drawn from the low of March 25th. For now, we remain careful with the short-term outlook, as we need to see a confirmation break of one of our key levels first, before examining any further directional move.
In order to get comfortable with higher areas, we would like to see a strong push through the upper side of the range, at 79.85, a break of which would confirm a forthcoming higher high. In this case, we could target the next potential resistance zone, at 80.65, marked by the low of December 18th. Slightly above lies another potential resistance zone near the 81.00 barrier, marked by the high of December 19th, which could also be considered as a potential resistance area.
Looking at our oscillators, the RSI and the MACD, both have somewhat slowed down their upside momentum. Nevertheless, both indicators are still showing positive signs, in order to support the above-discussed idea. The RSI is a above 50 and still has got some room to move higher. The MACD remains in the positive territory but is stuck to its trigger line and keeps balancing around it.
In terms of the downside, we will consider slightly lower levels if we see the previously-mentioned upside line getting violated and the rate falling below the 78.50 hurdle, marked by the low of April 2nd. This is when more sellers could join in and drive the pair towards the 77.95 obstacle, a break of which could push the rate further south, giving it the opportunity to re-visit the lower side of the aforementioned range, at 77.40.
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