Trade of the Day: AUD/JPY

By: Dima Chernovolov

AUD/JPY continues to fall inside the 30-minute Down Channel chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 6-bar level – which is the result of the slow Initial Trend (3 bars), above-average Uniformity (6 bars) and near-maximum Clarity (9 bars). AUD/JPY is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the resistance area shown below.

As can be seen from the daily AUD/JPY chart below, the price earlier reversed down from the resistance area made out of the key resistance level 78,40 (which stopped the sharp uptrend in August) and the upper daily Bollinger Band. The proximity of this resistance area and the overbought daily Stochastic increase the probability AUD/JPY will continue to fall inside this Down Channel.