The Australian dollar closed at its weakest level since early November, opening the door to a continuation of a broader downtrend from the start of the year. This is further reinforced by the bearish death cross between the 20-day and 50-day moving averages (MA) from August, with the former line acting as resistance recently.
However, AUD/USD faces positive RSI divergence. This is a sign of weakening momentum to the downside, which can sometimes precede a rise. Still, in such an outcome, the moving averages could act as resistance, maintaining a downside technical bias. Otherwise, before a 2022 bottom at 0.6170, a continuation lower will focus on the November 3 low of 0.6272.
Meanwhile, AUD/JPY faces a different technical picture. A symmetrical triangle chart formation has been brewing since earlier this year. Now, AUD/JPY is rapidly running out of room to consolidate between ascending support and descending resistance. The direction of the breakout could be the key to leading the broader trend.
In the event of an upside break, the key resistance level is the 23.6% Fibonacci retracement at 94.93. An extended rally could open the door for a revisit of the June high of 97.67. Otherwise, the key support is the 38.2% level at 93.23. Below the latter is the midpoint of 91.86. A stronger bearish technical conviction could see the pair fall towards the 61.8% level at 90.49.