AUDJPY Traders Watch as Key Technical Thresholds Are Tested
03 November 2023
In the currency market, AUDJPY has been a center of attention, as it recently exited a period of consolidation. The pair's escape from a symmetric triangle (red), which began in June, has set the stage for potential further gains. This breakout was a culmination of a tightening price range, evidenced by a blue rectangle indicating a compressed trading range.
Traders are now focusing on two crucial resistance levels. The first is a horizontal barrier at 96.9 (green), which has historical significance for the pair. The second, a descending trendline drawn from September 2022 peaks (blue), presents a dynamic obstacle. These converging resistances are a proving ground: a decisive breakout above them could solidify a bullish stance, suggesting a new leg upward for the Australian Dollar against the Japanese Yen.
Conversely, a rejection at these levels could indicate that the breakout lacks the momentum to sustain a rally. Should a reversal pattern emerge at this juncture, it may signal an opportunity for traders to consider short positions, expecting a potential retracement or resumption of the prior sideways trend.