AUDJPY Bullish Momentum Fades: Market Signals Major Correction Ahead

Market Analysis – June 27

AUDJPY is revealing signs of a major correction phase in the market. Since the breakout above 91.590, the price took off for the major high of 98.390 formed last year September. As most of the range has been covered by the bullish run, the Bulls reveal exhaustion signs.

AUDJPY Key Levels

Demand Levels: 90.00, 86.50, 80.00
Supply Levels: 95.50, 96.00, 98.40

AUDJPY Long-term Trend: Bullish

AUDJPY created a significant swing low in the market on the 24th of March. The low formed was lower than the significant low formed on the 20th of December. The lower low on the daily chart revealed a crack in correlation with the RSI (Relative Strength Index).

The RSI revealed a higher low on the 24th of March showing the unrevealed willingness of the market direction to reverse. The shift in market structure eventually was observed as an uptrend was established. The bearish trendline was invalidated as it gave way to the bullish trendline.

AUDJPY Short-term Trend: Bearish

On the lower time frame (4-hour chart) a shift in the market structure has been established. On the dairy chart, it only appears to be a failure swing though. The RSI (Relative Strength Index) and Stochastic are already overbought. Traders are likely to reduce long positions due to the early signal to get ready for hedging or shorting opportunities towards the lower demand level of 91.60.