Technical Overview of USD/JPY and AUD/USD Currency Pair

USD JPY

USD traded lower against JPY and closed at 110.42

USD/JPY stalls its bounce near 110.40 region and meets fresh supply over the last hour, as the risk-off sentiment intensifies amid rising coronavirus risks and knocks-off the US 10-year Treasury yields to a new record low just above the 1.30% level.

  • USD/JPY printed a bullish inside day candlestick pattern on Wednesday.
  • The pair could find bids and challenge resistance at 110.70-111.00.
  • USD/JPY: Bulls and bears jostle below 111.00 amid coronavirus fears
  • USD/JPY fails to hold onto the previous day’s recovery gains.
  • Traders smell fears in the US President Donald Trump’s measured comments.
  • Coronavirus updates keep the risk-tone under pressure, US data will decorate the economic calendar.
  • USD/JPY drops back towards 110.00 as US 10-year Treasury yields hit record lows

According to the Analysis, pair is expected to find support at 110.18 and a fall through could take it to the next support level of 110.05. The pair is expected to find its first resistance at 110.62, and a rise through could take it to the next resistance level of 110.75.

AUD USD

AUD traded higher against USD and closed at 0.6543.

AUD/USD extends the bounce above 0.6550 after Australia’s Q4 Capex data release. The headline number missed forecasts, however, estimates for 2020/21 bettered expectations. The risk-off tone in the markets could cap the further upside in the spot.

  • AUD/USD looks oversold as per the daily chart RSI.
  • The 4-hour chart RSI is reporting a bullish divergence.
  • The broader trend remains bearish with the pair stuck in a falling channel.
  • AUD/USD may witness a corrective bounce as technical charts are signaling seller exhaustion.

The 4-hour chart RSI has charted higher lows, contradicting lower lows on price. That bullish divergence indicates the bearish momentum has ebbed. The inverted hammer seen on the 4-hour chart is also echoing similar sentiments.

According to the Analysis, pair is expected to find support at 0.6540 and a fall through could take it to the next support level of 0.6524. The pair is expected to find its first resistance at 0.6590 and a rise through could take it to the next resistance level of 0.6606.

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Author: Mark Burg