**AUD/JPY Analysis: Bearish Momentum After False Breakout, Key Support Levels in Focus**
Recently, the AUD/JPY currency pair exhibited a notable false breakout above the 102.00 resistance zone, triggering a bearish impulse move that has shifted the sentiment towards a possible downtrend. This initial breakout, followed by a sharp reversal, suggests that buyers may be losing strength at these higher levels. The pair faced significant resistance near the top boundary of an upward-trending channel, where it has rebounded sharply, failing to sustain momentum past this resistance.
The technical signals on the weekly timeframe add further weight to this bearish perspective. A long-tailed bar has formed, typically indicative of a possible exhaustion of bullish pressure and a reversal in direction. This long wick suggests that sellers stepped in decisively, pushing prices down after an initial rise. As a result, it implies a potential shift in sentiment, hinting at the likelihood of lower price levels in the near term.
Currently, the broader trend of AUD/JPY appears to be moving sideways, oscillating within a defined range. The price action’s inability to break out convincingly beyond this range aligns with the view that any upward moves might be short-lived. The recent false breakout near the upper boundary underscores the presence of robust selling interest at this level, further supporting the case for a potential downside continuation.
Looking ahead, I expect AUD/JPY to pull back toward the resistance zone before resuming its bearish movement. This retracement may provide an opportunity to re-evaluate entry points as the pair potentially builds momentum for a deeper decline. My primary target is the support zone around 96.170, a level that aligns with both historical support and the lower boundary of the current range.
In summary, AUD/JPY has shown clear signs of bearish pressure following a false breakout and rejection at the channel’s top boundary. The combination of technical signals—the false breakout, long-tailed weekly bar, and sideways trend—suggests a strong case for continued downside action, with the 96.170 support zone as a key target. As the pair potentially retraces, I’ll monitor for signs of renewed selling pressure, particularly in the resistance area, before a deeper move down.
Recently, the AUD/JPY currency pair exhibited a notable false breakout above the 102.00 resistance zone, triggering a bearish impulse move that has shifted the sentiment towards a possible downtrend. This initial breakout, followed by a sharp reversal, suggests that buyers may be losing strength at these higher levels. The pair faced significant resistance near the top boundary of an upward-trending channel, where it has rebounded sharply, failing to sustain momentum past this resistance.
The technical signals on the weekly timeframe add further weight to this bearish perspective. A long-tailed bar has formed, typically indicative of a possible exhaustion of bullish pressure and a reversal in direction. This long wick suggests that sellers stepped in decisively, pushing prices down after an initial rise. As a result, it implies a potential shift in sentiment, hinting at the likelihood of lower price levels in the near term.
Currently, the broader trend of AUD/JPY appears to be moving sideways, oscillating within a defined range. The price action’s inability to break out convincingly beyond this range aligns with the view that any upward moves might be short-lived. The recent false breakout near the upper boundary underscores the presence of robust selling interest at this level, further supporting the case for a potential downside continuation.
Looking ahead, I expect AUD/JPY to pull back toward the resistance zone before resuming its bearish movement. This retracement may provide an opportunity to re-evaluate entry points as the pair potentially builds momentum for a deeper decline. My primary target is the support zone around 96.170, a level that aligns with both historical support and the lower boundary of the current range.
In summary, AUD/JPY has shown clear signs of bearish pressure following a false breakout and rejection at the channel’s top boundary. The combination of technical signals—the false breakout, long-tailed weekly bar, and sideways trend—suggests a strong case for continued downside action, with the 96.170 support zone as a key target. As the pair potentially retraces, I’ll monitor for signs of renewed selling pressure, particularly in the resistance area, before a deeper move down.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.