AUD/JPY regains bid tone on upbeat Aussie PMI, eyes RBA rate decision

AUD/JPY regained bid tone this Tuesday morning in Asia on the back of an upbeat Australia AIG manufacturing PMI. 

The trend line sloping upwards from the July 6 low and July 26 low offered support around 88.20. Currently, the cross is trading around 88.40; up 0.20% on the day. 

Focus on RBA’s take on the AUD strength, economy 

The RBA is widely expected to keep rates unchanged at the record low of 1.5%. What will move the AUD pairs today are the central banks taking on the soaring Aussie updated forecasts for Australian economic growth, inflation and unemployment. 

The central bank may attempt jawboning the US dollar, although the success isn’t guaranteed, especially if the inflation forecasts are revised higher. 

AUD/JPY Technical Levels

A rally of the rising trend line support has materialized into an break above 1-hour 50-MA level of 88.33, which now will act as a support ahead of 88.20 - trend line support and 87.62 - 23.6% Fib R of 81.78-89.42. 

On the higher side, breach of resistance at 88.54 - 5-DMA + 10-DMA would open up upside towards 88.83 - July high and 89.00 levels.