AUD/JPY - Indecision ahead of the RBA

AUD/JPY is trading in the sideways manner this Tuesday morning at 88.22 levels following the Monday's Doji candle, which indicates indecision in the marketplace ahead of the RBA rate decision.

Familiar RBA may disappoint AUD bulls - Reuters

The central bank is expected to keep interest rates unchanged at record low of 1.5%. There is some speculation that the policy statement may carry a slightly hawkish tone [tightening bias]. However, this contradicts the recent dovish comments from the RBA policymakers. The AUD might lose some ground if the statement is largely unchanged.

Meanwhile, the Japanese side of the story could strengthen if the major European equity indices wobble on Spanish clash.

AUD/JPY Technical Levels

A break above 88.45 [38.2% Fib R of Aug 8 low] would open up upside towards 88.70 [10-DMA] and 88.89 [Sep 27 high]. On the downside, breach of support at 88.04 [previous day's low] would expose 87.66 [50-DMA] and 87.35 [Aug 4 low].

• When is the RBA and how could it affect AUD/USD?