AUD/JPY Bearish Channel and EW Count

AUD/JPY has been trading within a downward trending parallel channel over the past week and a half. This can be seen in the hourly candlestick chart below as evidenced by the lower highs and lower lows. The pair was rejected from channel resistance on Nov 13 and 18 and rebounded from the base of the channel on Nov. 14, 15, 16, and again yesterday. Price action has also faced resistance around the 55-hour simple moving average which currently comes in around the top of the channel to provided added resistance. A look at the hourly RSI indicator shows that it has been in a bearish range with resistance just below the 58 level while Elliott Wave analysis suggests that the pair may continue lower in the parallel channel with wave 5 of an impulse. As seen below, waves 1 and 3 test the channel base while waves 2 and 4 fall short of testing the channel top. A shorter term 5-wave impulse can be seen within wave 3. If AUD/JPY continues to trade in the parallel bear channel, we would anticipate a move below the bottom of wave 3 and possible test of the channel base to complete the 5-wave impulse. A sustained break above the top of the channel and 55-hour SMA would negate our immediate downward bias and suggest the potential for a correction to the upside.