Is the Australian Dollar Heading Towards a Prolonged Decline Against the Yen?
03 October 2023
The Australian Dollar (AUD) to Japanese Yen (JPY) currency pair has found itself amidst turbulent waters, significantly impacted by a statement from the Reserve Bank of Australia that did no favors for the AUD. Subsequently, the AUD has cemented its place as one of the weakest currencies in its cadre, with the AUDJPY pair particularly reflecting these losses.
This bearish atmosphere didn’t spontaneously arise but was indeed signaled last Friday when the price formed a shooting star candlestick pattern. Recognized as a legitimate sell signal among traders, the ensuing results are visible in the present market conditions. Monday and Tuesday of this week have only exacerbated the situation, with the latter being especially pivotal due to the breaking of a long-term uptrend line, demonstrated with a black line on the chart.
Today’s candle, breaking below this significant uptrend line, holds particular weight. Should the price manage to close beneath this level, it will undeniably activate a substantial sell signal. In terms of potential targets, the yellow area around 92.8 emerges as a clear contender. Considering the present market circumstances and the recent trajectory of the pair, the probability of reaching this level in the upcoming weeks seems markedly high.
Investors and traders will likely be keeping a keen eye on the AUDJPY, as its future navigations, particularly concerning the 92.8 level, will offer crucial insights into the ongoing developments and potential future of the Australian Dollar in relation to its Japanese counterpart.