Talking Points:

• The AUD/JPY pair has been grinding upward for the third day in a row but has recently retreated from its daily high.
• The minutes of the Reserve Bank of Australia (RBA) show the policymakers’ hawkish leaning, and Governor Lowe also hinted at more rate hikes.
• Bulls are challenged by a triangle breakdown and a sluggish relative strength index (RSI), while short-term falls are limited by the 100-day SMA.
• The 61.8 % Fibonacci retracement from the 8th to the 16th of June’s fall needs to be confirmed by the bulls.

During today’s Asian trading session, the AUD/JPY pair is hovering around the 200-day SMA barrier, defending the 94.00 round number.

The latest changes in the cross-currency pair could be linked to RBA Governor Philip Lowe’s hawkish statement, as well as the Minutes of the most recent monetary policy meeting.

The negative breach of the three-day-old triangular pattern and continuous trading below the 200-day SMA, however, pose a challenge to the AUD/JPY bulls. The current downward RSI is also adding to the bull’s woes.

However, the AUD/JPY pair’s short-term downside is limited by the 100-day SMA level of 93.60, a break of which might lead bears to the 93.00 mark before exposing the monthly low around the 92.00 mark.

The bears may find intermediate hurdles at the 92.60 and 92.40 levels throughout the predicted drop.

Meanwhile, the 200-day SMA and the support line of the indicated triangle, both around 94.10 and 94.35, need to be validated for any recovery moves.

The aforementioned triangle’s resistance line and the 61.8 % Fibonacci retracement level, which is around 94.65 and 95.00 respectively, are also posing problems for AUD/JPY bulls.

Overall, the bulls are keeping an eye on AUD/JPY because it hasn’t extended the triangle breakdown and has stayed close to the 200-day SMA. However, they will require conviction if they want to take control of the currency pair.

AUD/JPY Hourly Chart: