FxWirePro: AUD/ JPY attracts selling interest, vulnerable to more downside

• AUD/ JPY dipped on Tuesday   as  Japanese currency was  supported by growing expectations the Bank of Japan will raise interest rates on Friday.

• The Bank of Japan is expected to raise interest rates on Friday, increasing short-term borrowing costs to levels not seen since the 2008 financial crisis..

•A BOJ rate hike would be the first since July last year, when the move, along with weak U.S. jobs data, shocked traders and sparked a global market rout in early August..

• With policy tightening expected this week, investors are looking to Ueda's post-meeting briefing for indications on the timing and speed of future rises.

•The technical outlook remains bearish and points to eventual bigger gains, fourteen-day momentum is negative, reinforcing the scope for a bigger drop.  

• Immediate resistance is located at 97.90 ( Jan 20th high), any close above will push the pair towards 98.11 (50% fib).

• Immediate support is seen at 96.91 (38.2% fib) and break below could take the pair towards 96.32 (Lower BB).

 Recommendation: Good to sell around 97.60, with stop loss of 98.80 and target price of 96.40