AUDJPY is moving further off 3-year lows after bouncing from 79.20 and staging a rally to 86.28. The pair has now retraced 61.8% of the downleg from 90.71 (December 2015 to January 2016 fall).
This Fibonacci level at 86.28 is now acting as resistance but if breached, prices have scope to move to the next Fibonacci level at 76.4% which lies at 88.38. This would result in the market rising above the daily Ichimoku cloud, which would shift the recent bearish bias and bring the market back to neutral in the medium term. RSI has now crossed above 50 into bullish territory so there is still room for more upside momentum.
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