- AUD/JPY gathers strength to near 114.35 in Tuesday’s early European session.
- The constructive outlook for the cross prevails above the key 100-day EMA, with bullish RSI momentum.
- The first upside barrier emerges at 114.75; the initial support level is seen at 113.85.
The AUD/JPY cross trades in positive territory around 114.35 during the early European session on Tuesday. Traders will closely monitor the developments surrounding the Middle East ceasefire amid mixed signals from US President Donald Trump.
Trump stated early Tuesday that he believes an agreement to reopen the Strait of Hormuz and extend the ceasefire with Iran is reachable “over the next week.” On Monday, US President shrugged off the possible collapse of peace negotiations with Iran, saying, “I don’t care if they’re over, honestly.”
The likelihood of stronger verbal intervention from Japanese authorities might help limit the Japanese Yen’s (JPY) losses. Finance Minister Satsuki Katayama said on Tuesday the officials stood ready to respond in the currency market as needed and refrained from commenting on recent exchange-rate moves.
The speech by Bank of Japan (BoJ) Governor Kazuo Ueda will be the highlight later on Wednesday. Ueda could offer some hints as to whether the central bank will proceed with a rate increase the following week.
Technical Analysis:
In the daily chart, AUD/JPY holds a bullish near-term bias as spot remains well above the 100-day simple moving average (SMA) and the Bollinger middle band. Price is pressing the upper side of the recent consolidation, while the Relative Strength Index (RSI) at 57.46 stays in positive territory without yet signaling overbought conditions, suggesting buyers still retain control but with reduced momentum compared to the prior peak.
On the topside, immediate resistance is aligned with the Bollinger upper band at 114.75, and a daily close above this barrier would open the way for a continuation of the broader uptrend. On the downside, initial support emerges at the Bollinger middle band around 113.85, ahead of the lower band at 112.98, with the 100-day SMA at 111.30 acting as a deeper structural floor that would need to give way to materially challenge the prevailing bullish structure.
