Downside risks have dominated the AUD/JPY currency pair since September 15 after the Aussie reversed from the upper boundary of a descending channel pattern at 74.26.
From a technical point of view, some downside potential could continue to dominate the exchange rate in the nearest future, as the pair might aim for the 70.50 area.
However, it is important to note that the currency exchange rate has to surpass a support level formed by the monthly S3, located at the 71.74 marks.
Thus, if the support level holds, a possible upside reversal could follow during the following trading sessions.
