AUD/JPY breaks initial resistance on Yen supply

AUD/JPY is currently better bid on the Yen weakness ahead of the Tokyo open.

AUD/JPY rallied from 79.24 until 79.60 so far. The move comes on the back of news from over the weekend that Abe intends to delay the sales tax hike until closer to the Olympics in 2020 making for a stronger economy and a more appropriate time to implement the initiative. Market sentiment could interpret that as bearish in anticipation of Japan's government launching a new round of stimulus spending. 

USD/JPY rallied through 25th April lows at 110.66 and has reached further resistance at 110.80/86 the high while the Aussie, better offered, consolidates the bearish close of last week below the 0.72 handle. There will be more action to come this week with a number of key Australian releases that include retail sales and GDP while at the end of the week, we turn to U.S. nonfarm payrolls.

AUD/JPY levels

AUD/JPY has broken the 200 sma at 79.29 and near-term resistance of the previous session highs at 79.50 to reach a fresh 7 day high of 79.60. 18th May highs of 80.08 come as resistance ahead of May 1st 80.63 lows. The 200 sma on the 4hr sticks at 81.44 and 81.93 thereafter guard 82.50 and 17th April lows of 82.46. 78.50 is key support to the downside guarding 6th May lows of 78.17.