AUDJPY recovers but remains in a bearish channel


The AUDJPY cross was trading at 0.3% higher on Monday as it tried to recover from the recent sell-off. Since stock markets across the globe are rising notably today, the AUDJPY cross was bid as well. 

However, the price remains within a large bearish channel; thus, the medium-term outlook still seems bearish. 

The first critical resistance now appears to be at 74.20, where previous lows (broken support) are converged with the 200-day moving average. Traders could be selling the current rally right there if sentiment remains negative. 

On the other hand, the support could be at last week's lows of 73.15, and if not held, the Aussie will most likely drop to the lower bound of the bearish channel, currently near 72.50.

Since tomorrow is election day, supports and resistances will not matter, and volatility is expected to be very high. Therefore, traders should use maximum caution when trading during these times. 
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