AUDJPY like other YEN crosses is in a period of consolidation. This pair is carving what appears to be a wedge pattern following the 850p decline that occurred between late Jan and March. However, we need more “touches” of the wedge and currently we only have 2 points of contact on each side which isn’t a very well defined structure, yet. I do think that a retest of resistance near 83.40/50 would trigger an influx of selling pressure. Likewise, a move to support near 81.40/50 would likely attract bulls. Given the recent 850p sell-off, this wedge may represent a continuation pattern. Either way, at 400pips from top to bottom a breakout in either direction could produce a favorable opportunity.
An upside break should target the 87.50 zone, while a downside breakout should open to 77.50. However, we need to wait for a break of consolidation to define an actual target and also assuming that this is indeed a wedge pattern. Let’s be patient and allow the market to show its’ hand first.

AUDJPY - DAILY - 14 MAY 2018

Source: MARYNA MURRAY

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