AUD/JPY Strategy: Trading the 108.00 Pivot as Bearish Pressure Mounts

The AUD/JPY pair enters the January 25, 2026 session under a localized cloud of distribution, having closed the previous liquid session at 107.42 after failing to sustain momentum above the 108.00 handle.

Market Context and Sunday Transition

As we transition into the new week, positioning hygiene remains paramount. The market has displayed a heavy profile, closing significantly lower from a daily high of 109.01. This price action suggests that the 108.00 level has shifted from a supportive base to a formidable structural pivot. Professional traders are currently prioritizing retests of prior-week extremes and round numbers rather than chasing initial breakout momentum.

Handover Markers for the Next Session

To navigate the upcoming volatility, monitor these specific liquidity windows for trend validation:

• 06:35 London: Initial impulse and range definition.
• 12:20 London: Price discovery and retest quality.
• 11:25 New York: NY confirmation—determining if the move is a trend extension or simple rotation.

AUD/JPY Technical Decision Map

The current technical layout identifies 108.00 as the primary regime filter. Trading below this level maintains an "offered" bias, while a reclaim suggests mean reversion toward resistance.

• Pivot Level: 108.00
• Figure Magnet: 107.00
• Resistance Ladder: 109.00 → 109.50 → 110.25
• Support Ladder: 107.25 → 106.75 → 106.00

For more on how recent price action compares to previous setups, see our AUD/JPY 108.00 Pivot BoJ Sensitivity Analysis.

Next Session Scenarios

1. Base Case: Range Rotation (60% Probability)

Expect price rotation back toward the 108.00 pivot with tactical range trading sustained between 107.25 and 109.00. High-quality information will be found at the boundaries where liquidity clusters reside.

2. Upside: Bullish Validation (20% Probability)

Acceptance above 109.00 opens the door for targets at 109.50 and 110.25. This scenario is invalidated if the market fails to hold the 108.00 pivot on a retest.

3. Downside: Bearish Continuation (20% Probability)

Sustained price action below 107.25 targets the 106.75 and 106.00 levels. A reclaim of the 108.00 pivot would invalidate this bearish bias.

Execution and Risk Management

In the current regime, the first break should be treated as a signal, while the retest serves as the entry. A genuine shift in market structure requires validation across multiple liquidity windows. If a breakout occurs but fails to hold beyond the boundary, it likely represents a liquidity trap rather than a new information regime.

Traders should adjust risk sizing based on realized range; if volatility expands, reduce leverage and widen stops. Stable risk per idea is the priority over forcing a single template across changing volatility environments.

Related Reading

Stay informed on broader market trends that may influence Yen crosses:

• AUD/JPY Strategy: Trading the 108.00 Pivot Amid Hawkish BoJ Bias
• NZD/JPY Strategy: Trading the 93.00 Pivot as Bearish Pressure Mounts
• BoJ Rate Hold at 0.75%: Hawkish Forecast Upgrades Signal Normalization