AUD/JPY has been bullish over the past couple of months, but it is now showing signs of potential weakness and the bears are ready to take over. The daily chart has remained a key timeframe whilst monitoring this pair going forward, we can now see a bearish bat has formed and will complete around the 88.600 price level.
After breaking out of a descending channel during November 2016, we have seen an increase of over 700 pips, but that run for the bulls is soon to be over. We are now approaching a crucial level of weekly resistance at 88.600, which aligns with the D point of the bearish bat on the daily chart (therefor completing the harmonic pattern and providing a shorting opportunity).
This price level has been a major pivot point in the market for almost two decades, with price trading above and below overtime.
To round off this opportunity, the relative strength index shows price is now over-bought on both timeframes (daily and weekly). Monday the 19th of December we have major impact news for both currencies, get it noted down on your calender and stay safe.