Price action on the daily timeframe of AUD/JPY (Australian dollar versus the Japanese yen) traded strongly to the downside in the final week of November. This followed a slow and gradual pullback since August.

Closing in on Resistance

Recent price movement has seen the Ichimoku’s Conversion Line (blue at ¥97.37) cross beneath the Base Line (red at ¥98.96), a move that is generally viewed as a bearish signal. On top of this, we have also seen another bearish indication in the form of the Ichimoku’s Leading Span A (light green at ¥98.17) crossing beneath the Leading Span B (light orange at ¥98.96), opening the door for an Ichimoku Cloud resistance.

Further supporting a bearish position on the daily chart, price action recently made its way beneath trendline support (from ¥90.17) and the 200-day simple moving average at 100.66.

Price Direction?

Given the recent downside pressure and today’s pullback, the area highlighted with a red circle between approximately ¥100.66 and ¥97.91 – consists of the Ichimoku Conversion and Base Lines, the Ichimoku Cloud resistance, the central Bollinger Band (20-day simple moving average at ¥99.02), and the 200-day simple moving average around the upper limit of the area – could offer enough technical resistance to tempt sellers into the market.

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