After finding support near 81.00 on Thursday, AUD/JPY shot up and during the European morning Friday, it emerged above the 81.65 resistance (now turned into support) barrier. The rebound from near 81.00 confirmed a higher low, while the move above 81.65 confirmed a forthcoming higher high on the 4-hour chart, and thus, we would consider the short-term picture to have turned somewhat positive for now.
That said, we would like to see a clear move above 82.05 before we get confident on more upside extensions. Such a break is possible to pave the way towards our next resistance of 82.40, defined by Monday’s peak. Another break above that level is possible to carry extensions towards the 82.75 zone.
Looking at our short-term oscillators, we see that the RSI edged north and moved above its 50 line, while the MACD, although negative, stands above its trigger line and looks to be heading towards zero. These technical studies support the notion for AUD/JPY to continue climbing higher for a while more.
On the downside, a dip back below 81.65 is possible to aim for the tentative uptrend line drawn from the low of the 19th of June, but even if this is the case, we would still see a cautiously positive short-term outlook. We believe that there would still be a decent likelihood for the bulls to jump in from near that line.
We would like to see a clear break below that short-term upside line before we abandon the bullish case. Such a dip could initially aim for another test near the 81.00 zone, the break of which could see scope for our next support territory of 80.70.
