FxWirePro: AUD/JPY pauses downside at 61.8% Fibo, bias lower, stay short

• AUD/JPY is hovering around 61.8% Fibo at 84.85, break below will accentuate weakness.
   
• The pair is likely in a phase of consolidation after breach of 200-DMA support last week.
   
• Technical studies are bearish and support further downside in the pair.
   
• 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.
   
• On weekly charts we see Doji formation and strong support at weekly cloud at 84.22.
   
• Break below cloud will see test of 78.6% Fib at 83.37 ahead of weekly 100-SMA at 83.16.
   
• Bearish invalidation on retrace above 200-DMA at 85.9841.

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 -120.603 (Bearish), while Hourly JPY Spot Index was at 82.8491 (Bullish) at 0420 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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