AUD/JPY is a classic risk trade/carry trade. It does well in the good times and takes a pistol whipping in the bad times.
This week, AUD/JPY fell 2.05% or 170 pips with all the declines coming during Tuesday’s panic trade. It was the biggest mover on the week. The declines stalled ahead of the 55-week moving average and the August low of 86.41.
AUD/JPY weekly chart with 55-wma
Last week’s best trade was short NZD/CHF. We looked at the chart and it broke support this week but rebounded to unchanged. The weekly doji star signals a potential rebound next week but it remains in a very delicate spot.
Both charts are very similar in that they are at the bottom of recent ranges and vulnerable to a breakdown.
What do you think will be the best trade in the week ahead?
