Trade of the Day: AUD/JPY

By: Dima Chernovolov

AUD/JPY continues to fall inside the daily Down Channel chart pattern which was identified recently by Autochartist. Autochartist measures the quality of this Down Channel at the 7-bar level – which reflects the above-average Initial Trend and Uniformity (6 bars) and strong Clarity (8 bars). AUD/JPY is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the resistance area highlighted below.

As can be seen from the daily AUD/JPY chart below, the price earlier reversed down from the resistance area lying between the pivotal resistance level 74.00 (former strong support from June), upper daily Bollinger Band and the 38.2% Fibonacci retracement of the previous extended downward impulse from April. The proximity of this resistance area increases the probability AUD/JPY will continue to fall inside this Down Channel.