AUD/JPY bounces 2% on the day but the technical picture hasn’t changed yet

AUD/JPY is the biggest mover on the day, up by over 2.3% currently

ForexLive

With the case of the aussie, the argument has been to not catch the falling knife after the recent drop this week. And in that lieu, the two things to focus on in case the situation changes are a change in market sentiment or a change in near-term technicals.

The former is favouring the aussie today as risk is bouncing back, but compared to the losses sustained over the last two days this is but a tiny victory i.e. dead cat bounce.

Meanwhile, the latter is also not suggestive of any major turnaround just yet. Near-term price action is still resting below both key hourly moving averages despite the bounce today and the 67.00 level is so far keeping gains in-check for now.

The market may be finding some relief after a sharp drop over the past two days, but turnaround this morning is not the kind of thing you’d want to pin your hopes on just yet – especially not when the technical picture still hasn’t changed.

In the big picture, the path of least resistance still spells out more pain for the aussie – well, for now at least anyway:

AUD/JPY M1 13-03