AUDJPY has been immune to all the volatility in the broader market lately, which is quite surprising since the pair is considered a proxy for risk appetite. The price action has been trapped within a narrow range between 84.00 and 80.50 for several months now.
The convergence between the moving averages (MAs) confirms that the picture is neutral. It’s a similar story with the short-term oscillators as both the RSI and the MACD are stuck near their neutral levels, providing no clues about what’s next.
In case the bulls retake control and the pair powers higher, the first barrier to advances may be the 83.50 zone. A violation would turn the focus towards the upper boundary of the aforementioned range, near the 84.00 handle.
On the downside, the bears could fight their first battle around the 82.10 region. If that doesn’t hold, the next target could be the 81.50 level, where another break might open the door for the lower boundary of the range at 80.50.
In short, AUDJPY is trapped in a holding pattern. A decisive move either above 84.00 or below 80.50 is needed to inject life back into the market.
