• AUD/JPY rallies for three straight days, though tests solid resistance at around 91.00.
• Three daily closes above the 200-day EMA would cement the AUD/JPY uptrend.
• Downside risks remain if AUD/JPY drops below 91.00, which could exacerbate a fall toward 90.00.

The AUD/JPY climbed above the 91.00 figure following the Bank of Japan’s (BoJ) decision last Friday to hold rates unchanged while maintaining its Yield Curve Control (YCC). Therefore, the AUD/JPY has gained since then 3.04%. As the Asian session begins, the AUD/JPY is trading at 91.14.

AUD/JPY Price Action

After clearing the latest cycle high achieved on April 20 at 90.78, the AUD/JPY extended its gains, breaking a downslope resistance trendline drawn from September 2022 highs of around 98.60. in addition, the 200-day Exponential Moving Average (EMA) at 90.75 was cleared, suggesting that the bearish bias is negated in the near term. To cement the bullish bias, the AUD/JPY must achieve three daily closes above the 200-day EMA. Once done, that could pave the way for further upside.

If AUD/JPY breaks above the January 9 daily high at 91.82, the 92.00 figure is up for grabs as buyers prepare to challenge the YTD high at 92.99.

However, if AUD/JPY tumbles below 91.00, a reversal toward the 200-day EMA at 90.75 is on the cards. If the May 1 low at 90.01 is compromised, a bearish engulfing candle pattern could form and, alongside the 200-day EMA, it could trigger a trend reversal that can challenge the YTD lows.

The next support would be the 50-day EMA at 89.71, immediately followed by the 20-day EMA at 89.64.

AUD/JPY Daily Chart