FxWirePro: AUD/JPY recovery capped at 5-DMA, good to stay short on break below 79.50

AUD/JPY chart on Trading View used for analysis

• Recovery attempts in AUD/JPY capped at 5-DMA which is immediate resistance at 80.42.
   
• The pair remains on a strong bear trend, Aussie bears stay firmly in the drivers’ seat.
   
• The Reserve Band of Australia left the cash rate at 1.5% as widely expected, with slight tweak in statement.
   
• The RBA confirming that the A$ "has depreciated against the US dollar along with most other currencies.
   
• A$ has popped slightly higher post the meeting, but has failed to build on to gains and has resumed weakness.
   
• Poor Australia Q2 current account deficit data weighs. ABS reported a wider-than-expected Q2 current account deficit (CAD) at AUD 13.5 billion, above the expected print of AUD 11.5 billion.
   
• Technical indicators on daily charts are bearish. Stochs and RSI biased lower and MACD shows bearish crossover on signal line.
   
• AUD/JPY has again slipped below 80 mark, and currently finds strong trendline support at 79.50.
   
• Break below will drag the pair lower. Test of 61.8% Fib at 79.26 then likely.
   
• On the flip side, 50-DMA is major resistance, we see upside only on break above.

Support levels - 79.50 (Trendline support), 79.26 (61.8% Fib), 79

Resistance levels - 80.41 (5-DMA), 81.03 (21-EMA), 81.80 (50-DMA)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-AUD-JPY-Technical-Outlook-1422622) is approaching final targets.

Recommendation: Book partial profits at lows. Watch out for break below 79.50 for further weakness.  

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -103.686 (Bearish), while Hourly JPY Spot Index was at 62.3139 (Neutral) at 0825 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.