AUD/JPY has managed to increase a little on the short term and now is located above two crucial support lines. Only a valid breakdown will open the door for a further drop in the upcoming period. However, the current rebound could be only a temporary one as the rate has reached a dynamic support and now tries to jump higher.

The Yen could take full control again and could increase and dominate the currency market only if the JP225 will drop further on the short term.

The Aussie continues to be sluggish, even if the Australian Trade Balance has come in better than expected. The indicator was reported at 1.55B, higher versus the 1.46B estimate.

The Yen will dominate the currency market if the Nikkei stock index will continue to drop on the short term. You can see that the index has opened with a huge gap down today and now is trying to recover. It has dropped below the outside sliding line (SL) of the major descending pitchfork. I’ve told you in the last week that it could approach and reach the lower median line (lml) of the ascending pitchfork. A valid breakdown below the lower median line (lml) will open the door for more declines.

Price has rebounded from the first warning line (WL1). It has managed to jump above the lower median line (lml) of the descending pitchfork. you should know that a valid breakdown below the WL1 and below the lower median line (lml) will give us a great chance to go short on this pair. It could approach and reach at least the 78.00 psychological level if this scenario will take shape. The perspective will remain bearish as long as the rate will stay below the median line (ml).