Key contention is seen at 94.00

• AUD/JPY manages to stabilize above the 94.50 area after retreating from a weekly high. 
• 94.70 is the immediate barrier for AUD/JPY, an initial support level is 94.35.
• The Relative Strength Index (RSI) is approaching the oversold territory.

The AUD/JPY pair drops from a weekly high of 95.40 and remains steady around 94.50 during the early Asian session on Monday. According to the one-hour chart, the path of least resistance for the AUD/JPY is to the downside, as the cross stands below the 50- and 100-hour Exponential Moving Averages (EMA).

The 94.70 level  is the immediate barrier for AUD/JPY bulls, representing the 100-hour EMA. A break above the latter could see the cross test 95.40 (High of July 14), followed by 95.60 (High of July 7). The critical resistance level is seen at 96.00, portraying a psychological round mark and a low of July 5. 

On the flip side, the cross will meet an initial support level at 94.35 (a daily low). The next contention is seen at 94.00, representing a psychological level and horizontal support line. The additional downside filter to watch is 93.65 (Low of July 12).

It’s worth noting that the Relative Strength Index (RSI) is in a downtrend approaching the oversold zone. Further downside for AUD/JPY cannot be ruled out. 

AUD/JPY one-hour chart