FxWirePro: AUD/JPY breaks major resistance at 86.75, good to go long on dips

• AUD/JPY has broken major trendline resistance at 86.75, eyes 20-DMA at 87.65.  
   
• Aussie remains bid against JPY as risk sentiment stabilizes amid fading North Korea tensions and as Australia wage inflation numbers matched estimates.
   
• Data released earlier today showed Australia second quarter wage price index came-in as expected at 1.9% y/y and 0.5% q/q.
   
• Technical indicators have turned bullish. Stochs have rolled over from oversold levels and RSI is biased north.
   
• The pair finds major trendline support at 85.75, we see weakness only on break below.
   
• Violation at 20-DMA could see further upside. Bullish invalidation on break below 85.75.

Support levels - 86.39 (converged 50-DMA & 38.2% Fib retrace of 81.48 to 89.42 rally), 86, 85.75 (rising trendline)

Resistance levels - 87.55 (23.6% Fib), 87.65 (20-DMA), 88

Call update: Our previous call (http://www.econotimes.com/FxWirePro-AUD-JPY-on-track-to-test-50-DMA-at-86-stay-short-844470) has hit TP1&2.

Recommendation: Good to go long on dips around 86.80/90, SL: 86.35, TP: 87.55/ 87.65/ 88

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 46.2717 (Neutral), while Hourly JPY Spot Index was at -115.365 (Bearish) at 0800 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex. 

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