AUD/JPY 4H Chart: Channel Down

Source: Dukascopy Bank SA
© Dukascopy Bank SA
While the Aussie is bullish relatively to its Singapore counterpart, we hold a bearish bias towards AUD/JPY. The recently established channel implies that a sell-off from 87.60 will extend through the nearest supports, including the monthly PP and 200-period SMA at 86.00. Bulls are expected to temporarily gain control of the market somewhere near 85 yen, but the ensuing recovery is to be capped by the upper trend-line of the channel. In case there is a break-out to the upside, the initial target will be the October 23 high at 88.10, followed by the October high and monthly R1 at 88.70. Meanwhile, the market is overcrowded with bulls—their share is 73%.
© Dukascopy Bank SA
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