AUD/JPY Price Forecast: Losses Below 113.00 Persist as Intervention Fears Cap Gains, But Bullish Bias Remains

The Australian dollar struggled to maintain upward momentum against the Japanese yen on Tuesday, with the AUD/JPY pair holding losses below the 113.00 threshold. The currency pair remains under pressure from persistent fears of official Japanese intervention, even as the broader technical picture retains a mildly bullish tilt.

Intervention Fears Cap Upside Potential

Market participants remain wary of potential intervention by Japanese authorities, who have repeatedly signaled readiness to step in to curb excessive yen weakness. This sentiment has created a ceiling for the AUD/JPY pair, preventing a decisive breakout above 113.00 despite underlying support for the Australian dollar. The yen has found some safe-haven bids amid global growth concerns, further limiting the pair’s upside.

Technical Outlook: Mildly Bullish Bias Intact

From a technical perspective, the AUD/JPY pair continues to trade above its 50-day and 100-day moving averages, suggesting that the broader trend remains constructive. The Relative Strength Index (RSI) is hovering near 55, indicating moderate bullish momentum without being overbought. Key support is seen at 112.50, followed by the 112.00 psychological level. A sustained move above 113.00 could open the door to a test of the 113.50 resistance zone, though intervention fears may limit follow-through.

What This Means for Traders

For forex traders, the current environment requires a balanced approach. The mildly bullish bias offers potential for long positions, but the intervention risk demands tight risk management. A break below 112.50 would signal a shift in sentiment, potentially accelerating losses toward 111.80. Conversely, a clear close above 113.00, especially on strong volume, would confirm bullish momentum.

Conclusion

The AUD/JPY pair is caught between a mildly bullish technical setup and the overhang of intervention risk. While the bias remains positive, traders should remain cautious near the 113.00 level. The coming sessions will be critical in determining whether the pair can overcome this resistance or whether selling pressure will intensify.

FAQs

Q1: Why is AUD/JPY struggling to break above 113.00?
The pair faces selling pressure near 113.00 due to persistent fears of Japanese official intervention to support the yen. This creates a psychological barrier that limits upside momentum.

Q2: Is the AUD/JPY still in a bullish trend?
Yes, the broader technical picture remains mildly bullish, with the pair trading above key moving averages and the RSI in positive territory. However, the upside is capped by intervention risks.

Q3: What key levels should traders watch?
Key support is at 112.50 and 112.00. A break below 112.50 would signal bearish pressure. Resistance is at 113.00 and 113.50. A sustained move above 113.00 could trigger further gains.