Understanding the Impact of Fibonacci Retracements on #AUDJPY Trades

#AUDJPY ANALYSIS

The AUDJPY currency pair has recently demonstrated notable price action, particularly as it has encountered the .618% Fibonacci Retracement level situated at 94.74. This level is significant in technical analysis, often acting as a critical point where traders anticipate potential reversals or continuations in market trends. The recent price rejection at this Fibonacci level suggests that sellers are gaining momentum, indicating a shift in market sentiment following a Change of Character (CHOCH) in price behaviour.

The CHOCH typically signifies a transition from a bullish to a bearish trend or vice versa, and in this case, it appears to have set the stage for a downward movement. As we look ahead, the question arises whether the AUDJPY will indeed proceed towards our targeted price level of 92.20 in the upcoming days. This target represents a significant psychological and technical level that could attract further selling interest if reached. Traders will be closely monitoring various indicators and market conditions to assess the likelihood of this downward trajectory. Factors such as economic data releases from Australia and Japan, geopolitical developments, and shifts in market sentiment will play crucial roles in determining the pair's next moves. In summary, the rejection at the .618% Fib Retracement level at 94.74, combined with the recent CHOCH, raises the possibility of a bearish continuation towards our target of 92.20. Market participants should remain vigilant and consider both technical indicators and broader economic influences as they navigate this currency pair in the coming days.

Chris