The AUDJPY currency pair experienced a significant price correction following an impulsive displacement. After a gradual decline through a bearish parallel channel in Q1, the pair witnessed a wild bearish breakout, and the price is now correcting to the origin of the displacement.
AUDJPY Key Levels
Demand Levels: 87.400, 83.900
Supply Levels: 95.300, 98.300
AUDJPY Long-term Trend: Bearish
The AUDJPY price decline in the year’s first quarter was characterized by lethargic selling pressure. The lower highs consistently pressed on the Exponential Moving Average (EMA) period 20, indicating a strong bearish sentiment. The descent halted upon reaching the support level of 93.000, causing a bounce off the resistance trendline of the parallel channel.
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This month, a wild bearish displacement followed, breaking the support level of 93.050. The price plummeted to the next support level at 87.800, marked by high volatility. Notably, the Volume indicator rose above 80 for the first time this year, signifying massive orders and confirming the strength of the bearish move.
AUDJPY Short-term Trend: Bearish
The price action has transitioned to a correction phase, driven by the energy dispelled in the bearish breakout. Currently, the price is heading back to the broken demand level of 93.000, where an unmitigated bearish order block lies. This correction is expected to be a significant test for the pair, potentially influencing its future direction.
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