Comprehensive AUD/JPY Analysis for January 16, 2024

In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the AUD/JPY for 16th January 2024. 

AUD/JPY Key Takeaways 

• BOJ is ready to change: Makoto Sakurai, a former board member of the Bank of Japan, said in an interview last week that the Bank of Japan is fully ready to end the world’s last negative interest rate policy. April is the most likely time to do so. They are just waiting for the final push from one or two economic data. 
• Inflation in Australia remains high: Last Wednesday, Australia announced the seasonally adjusted annual CPI rate at the end of November. The data suggests inflation is slowly declining but remains above the 2%-3% target range. This means that the Reserve Bank of Australia will most likely remain on hold this year, and may not ease policy until 2025. 

AUD/JPY Technical Analysis

AUD/JPY Daily Chart Insights

• Stochastic Oscillator: The indicator has not entered the overbought area, and at the same time issued a short signal, suggesting that the current bulls do not have enough strength to continue their upward move, and the market price may fall at any time. 
• Convergence interval: AUDJPY has been fluctuating at high levels since December 20 last year. It has now formed a convergence triangle, and is also supported below by the black 65 moving average. The strength of the support below is higher than the resistance above, and the probability of rebound is higher. However, if it falls below the support, the exchange rate will usher in a strong downward trend. 

AUD/JPY 1-hour Chart Analysis

• Stochastic Oscillator: The indicator sends a short signal at the 50 midline. Currently, short-term shorts have the upper hand. It is worth switching to a smaller period, such as the 15-minute chart, to observe whether there is a signal to enter the market for shorting. 
• MA support was destroyed: Yesterday, AUDJPY continued to hover and adjust above the green 240-period moving average. It fell rapidly after falling below the moving average during the Asian session today. The exchange rate was bearish before touching the lower support level during the day. 
• Wolf Wave: It is worth noting that the overall trend forms a Wolf Wave pattern as shown in the figure. Point 5 is the extension line connecting points 1 and 3. After the exchange rate falls to near the price of point 5, there is a certain probability that it will rebound towards the price of point 4. 

Trading Central Pivot Indicator

• According to the trading central in Ultima Markets APP, the central price of the day is established at 102.58, 
• Bullish Scenario: Bullish sentiment prevails above 102.58, first target 102.76, second target 102.90; 
• Bearish Outlook: In a bearish scenario below 102.58, first target 102.16, second target 101.91. 

Conclusion