FxWirePro: AUD/JPY extends weakness below 200-DMA, on track to test 78.6% Fib at 83.37, stay short

• AUD/JPY edges higher from fresh 5-month lows at 84.50, currently trades around 84.78 levels.
   
• The major is extending grind after break below 200-DMA which is currently major resistance at 86 levels.
   
• Technical studies are bearish, we see scope for further downside.
   
• RSI and Stochs are in oversold territory so some caution advised. MACD supports trend lower.
   
• We see -ve DMI dominance and ADX is above 25 levels and rising which suggests further downside.
   
• The pair has broken below 61.8% Fib at 84.85, scope now for test of 78.6% Fib at 83.37.

Support levels - 84, 83.73 (June 22 low), 83.37 (78.6% Fib retrace of 81.486 to 90.305 rally)

Resistance levels - 84.85 (61.8% Fib), 85.50 (5-DMA), 86 (200-DMA)

Call update: Our previous call (http://www.econotimes.com/FxWirePro-AUD-JPY-on-track-to-test-200-DMA-at-860-good-to-short-rallies-1003727) has hit all targets.

Recommendation: Book partial profits at lows, trail stop loss to 85.50, hold for 84/ 83.75/ 83.40.

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -16.4606 (Neutral), while Hourly JPY Spot Index was at 34.7597 (Neutral) at 0620 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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