31 Jul 2013
AUD/JPY broken technically after violation of 89.39
FXstreet.com (Barcelona) - The AUD/JPY closed below key “correction support” at 89.39 Tuesday which puts the chart of the oversold cross in “broken” territory. Will proposed Japanese policy changes stop the downward momentum?
AUD/JPY has data to digest today and policies to consider long-term
Economic data out of Japan and Australia late Tuesday and early Wednesday as well as a steady flow of data the rest of this week and into next week will give some direction to the beaten up AUD/JPY. Traders, however, have the interest rate decisions from both the Reserve Bank of Australia and the Bank of Japan circled on the calendar next week as critical near-term drivers for the AUD/JPY.
With the very clear dovish stance towards fiscal and monetary policy in Australia, and potential change in the recent downward direction in the AUD/JPY will likely have to come from Japanese policies. On that note, a looming decision on a proposed sales tax hike in Japan may be an important long-term driver for Japanese inflation, interest rates and of course, the Yen.
AUDJPY Technical Outlook
Now that 89.39 support was broken, technicians see the AUD/JPY reaching down to at least 88.23 and possibly down to 87.52 – both of which are Fibonacci projections. Short-term resistance is now the 7/12 close at 89.79 and is backed up by the 7/22 high at 92.59.
AUD/JPY has data to digest today and policies to consider long-term
Economic data out of Japan and Australia late Tuesday and early Wednesday as well as a steady flow of data the rest of this week and into next week will give some direction to the beaten up AUD/JPY. Traders, however, have the interest rate decisions from both the Reserve Bank of Australia and the Bank of Japan circled on the calendar next week as critical near-term drivers for the AUD/JPY.
With the very clear dovish stance towards fiscal and monetary policy in Australia, and potential change in the recent downward direction in the AUD/JPY will likely have to come from Japanese policies. On that note, a looming decision on a proposed sales tax hike in Japan may be an important long-term driver for Japanese inflation, interest rates and of course, the Yen.
AUDJPY Technical Outlook
Now that 89.39 support was broken, technicians see the AUD/JPY reaching down to at least 88.23 and possibly down to 87.52 – both of which are Fibonacci projections. Short-term resistance is now the 7/12 close at 89.79 and is backed up by the 7/22 high at 92.59.