AUD/JPY Price Forecast: Pair Weakens to Near 112.50, but Uptrend Remains Intact

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AUD/JPY Price Forecast: Pair Weakens to Near 112.50, but Uptrend Remains Intact

The AUD/JPY currency pair has edged lower in recent trading sessions, slipping to around 112.50. Despite this short-term pullback, the broader technical structure suggests the uptrend remains constructive, leaving traders to weigh whether this is a healthy correction or the beginning of a more significant reversal.

Technical Overview: Pullback Within a Broader Uptrend

The Australian dollar has weakened against the Japanese yen after failing to sustain gains above the 113.00 handle. The move lower has brought the pair back toward the 112.50 support zone, a level that has previously acted as both resistance and support in recent weeks. From a technical perspective, the pair remains above its key moving averages on the daily chart, including the 50-day and 200-day simple moving averages, which continue to slope upward. This alignment typically signals that the underlying trend remains bullish, with the current decline appearing as a corrective move rather than a trend reversal.

Key Support and Resistance Levels to Watch

For traders monitoring the pair, the immediate support level is located at 112.30, followed by the more significant floor at 112.00. A break below 112.00 could expose the 111.50 area, which coincides with the 50-day SMA. On the upside, resistance is now clustered around 113.00, with a decisive move above that level needed to confirm the resumption of the uptrend. A sustained break above 113.00 would open the path toward the 113.50 region, a level not seen since early this year.

What This Means for Traders

The current price action is a classic example of a pullback within a trend, a pattern that often attracts buyers looking for entries at relatively lower levels. However, the strength of the Japanese yen, influenced by shifting expectations around Bank of Japan policy, adds a layer of uncertainty. The Australian dollar, meanwhile, remains sensitive to commodity prices and risk sentiment. For now, the constructive uptrend suggests that dips toward support may be viewed as buying opportunities, but a break below 112.00 would challenge that view.

Conclusion

The AUD/JPY pair’s retreat to near 112.50 is a notable but not alarming development. The broader uptrend remains intact, supported by favorable moving average alignment and the pair’s ability to hold above key support levels. Traders should watch the 112.00–113.00 range closely for the next directional cue. A sustained move above 113.00 would likely renew bullish momentum, while a break below 112.00 could signal a deeper correction.

FAQs

Q1: Why did AUD/JPY weaken to near 112.50?
The pair failed to sustain gains above 113.00, leading to a short-term pullback. This move is partly driven by profit-taking and shifting sentiment around the Japanese yen.

Q2: Is the AUD/JPY uptrend still valid?
Yes, the uptrend remains constructive as the pair trades above its key moving averages and holds above the 112.00 support level. The current decline appears corrective.

Q3: What are the key levels to watch for AUD/JPY?
Immediate support is at 112.30, with stronger support at 112.00. On the upside, resistance is at 113.00, followed by 113.50. A break above 113.00 would confirm bullish continuation.

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