AUDJPY has been under selling pressure this week, crashing below its 50-day simple moving average (SMA) on Tuesday. However, the price appears to be bouncing off the medium-term ascending trendline today, and the momentum indicators suggest that a rebound could be underway.

The RSI has already started to turn upwards, having dipped below 50 on Friday, but has yet to reach its zero neutral line. The stochastics are rebounding in the 4-hour but will need more time in the daily timeframe to begin a convincing reversal. Hence, the current upswing is far from being on a solid footing and the short-term bias remains tilted to the downside.

If the positive momentum gathers strength, the pair could meet immediate resistance at the 50-day SMA, which stands at 91.10. There are further obstacles at the 20-day SMA near 91.80 and the recent peaks around 92.25. If overcome, the bulls could then challenge the 200-day SMA at 93.10.

However, if today’s bounce loses steam and the price falls below the ascending trendline in the 90.20 region, there could be support at the 23.6% Fibonacci retracement of the September-December 2022 downtrend at 89.72. A steeper slide would bring into focus the previous downtrend line and specifically, the 88.00 level.

To conclude, it is too early to assume that the short-term selling pressure is easing. Meanwhile in the medium-term, AUDJPY would need to cross above the 200-day SMA to achieve a higher-high and extend the rebound from the December low, whereas a drop below the uptrend line would nullify this bullish formation.