The AUD/JPY currency pair is currently exhibiting signs that could indicate a shift in price momentum from a bearish to a bullish trend. Recent technical analysis suggests that a potential bullish reversal may occur if the nine-day Exponential Moving Average (EMA) crosses above the 14-day EMA. Such a crossover could lay the groundwork for a stronger bullish sentiment in the market.
As of Tuesday during the Asian trading session, AUD/JPY is hovering around the 100.50 mark, maintaining a relatively stable position after an impressive gain of nearly 1% in the prior session. The daily chart analysis reveals that the pair is in the process of attempting to breach the nine-day EMA, which is an important indicator of shifting market dynamics.
At present, the nine-day EMA is positioned just south of the 14-day EMA. An upward crossover between these two moving averages would serve as an important signal that recent price movements are gaining upward momentum, suggesting a shift from a short-term bearish trend to a more bullish phase.
The 14-day Relative Strength Index (RSI) is currently resting at the neutral level of 50, reflecting a balanced market condition. The next movements in the AUD/JPY pair will be critical in establishing a clearer trend direction.
In terms of potential price action, the pair is currently facing immediate resistance near the nine-day EMA at approximately 100.58, with additional resistance at 100.61. Should the pair manage to surpass these levels, it could foster a bullish momentum that might drive it towards a four-month high of 102.41, which was reached on November 7.
Conversely, the primary support level for AUD/JPY is identified around the recent low of 99.42. A decline below this level could reinforce a bearish outlook, bringing the currency pair closer to the psychological support threshold of 99.00.
