AUD/JPY is in a strong descending channel and has beautifully bounced off the support at 72.50. This corresponds really well with the RSI bouncing off our ascending support. However, we are also seeing a strong descending resistance line on our RSI. Our goal is to play to the key graphical overlap and Fibonacci retracement at 81.30, which is also near the channel upper limit. This would be in line with our resistance on our RSI. Our view is strengthened by our RSI showing bullish divergence vs price.
Trading recommendations:
Buy now and at 72.50
Stop loss at 65.00 (Fibonacci projection level)
Take profit at 81.30 (graphical overlap resistance + Fibonacci retracement level + channel upper limit.
