The Australian dollar was seen consolidating in a range against the Japanese yen, but the overall bias remains towards the downside in the short term. The Chinese GDP release helped the Aussie dollar to some extent, but the upside was limited. So, I think selling the AUDJPY aiming for a new low is a good option in the near term. Let us see what charts suggest us and how we can enter into a sell trade.
There is a descending channel formed on the hourly chart of the AUDJPY pair, and it also has a major support area around the 93.50-30 levels which also coincides with the channel support area. So, if the pair moves lower, breaks the mentioned support area and close below it, then we can enter into a sell trade once the pair attempts a retest of the broken support area.
Initial target should be around the 92.20 level, and final target could be around the 91.60 levels. Stop should be placed above the 200 hourly moving average.
Reviewing recent events and trades
There was no major release during the NY session yesterday, which caused the forex market to mostly consolidate in a range. However, the US dollar was somehow seen trading lower Intraday. This sentiment got a boost once the Chinese GDP data was released during the Asian session. The outcome was better than expected which ignited a rally in the risk correlated pairs such as AUDUSD, EURUSD and NZDUSD. This particular market sentiment might continue for some time.
Fundamental Outlook for the day
Today, the US existing home sales data will be published during the NY session. The market is expecting a good increase in the sales this time around. If the outcome misses the forecast, then it would set up for more losses in the US dollar. On the other hand, a better outcome might increase the possibility of a correction in the US dollar. Moreover, the Japanese trade balance data will be released during the next Asian session, which might ignite moves in the Japanese yen.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: GBPUSD, GBPCHF, AUDCAD, USDCAD, USDJPY, CADJPY, AUDJPY and NZDUSD.
Get it HERE: Vladimir’s Markets Forecast
Trade carefully friends. Happy trading!
