AUD/JPY has been quite bearish recently after bouncing off the 89.00 price area and is currently residing just above the support area of 87.30. AUD has been the dominant currency in the pair for a while now, but JPY gained good momentum amid positive economic reports published recently. Recently, Australia’s Retail Sales report was published with a significant increase to 1.2% from the previous value of 0.5% which was expected to decrease to 0.4%. The positive result of the economic report helped the currency to gain momentum after an impulsive bearish pressure to bounce off the support area of 87.30. On the other hand, despite having worse economic reports today, JPY is currently gaining momentum. Today, Japan’s Bank Lending report was published with a decrease to 2.5% which was expected to be unchanged at 2.7% and Current Account report showed a significant decrease to 1.70T from the previous figure of 2.44T which was expected to be at 2.19T. As for the current scenario, the market is quite indecisive but JPY is expected to have an upper hand over AUD in the coming days leading to more bearish pressure in the pair.
Now let us look at the technical chart. The price has recently bounced off the dynamic level of 20 EMA after an impulsive bullish pressure off the support area of 87.30. As the price is heading downward and have a daily close below 87.30, the bearish pressure will be confirmed to push the price much lower towards 85.00 support area in the coming days. As the price remains below the dynamic level of 20 EMA and 88.00 price area, the bearish bias is expected to continue further.