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23 Jan 2015
AUD/JPY: Bearish bias retained post China PMI
FXStreet (Bali) - AUD/JPY continues to retain a bearish bias despite China HSBC/Market PMI came slightly better-than-expected, with a 0.2 points surprise factor, following a 49.8 read in Jan vs 49.6 expected.
AUD/JPY has come under renewed selling pressure in the past 2 days, mainly via AUD/USD sales, with buying interest in USD/JPY not as strong, with the market still cautious over near term expectations of further QE by the Bank of Japan, as opposed to the more aggressive pricing of rate cuts by the RBA in February.
According to Jim Langlands, Founder at FXCharts: "There have been some rather bearish observations out with regards to the Aud recently; last week Blackrock said it was heading sub 0.7000, and yesterday ANZ noted the critical week coming up, with the growing potential for the Aud to soon head below 0.8000. An ANZ note to client’s stated that “Should next week’s business confidence and CPI numbers look as soft, as we anticipate, a more sustained RBA easing cycle will be priced, and the AUD will break through USD0.8000”."
Technically, AUD/JPY presents a bearish picture short term, with the hourly chart price action being capped by a downward 20 EMA, which has acted as reliable dynamic resistance on the Chinese-inspired bounce circa 95.30. Immediate support comes at 95.00 (current level) followed by 94.85 (US low) and deeper declines towards Jan 14 low at 94.35. On the upside, bears are firmly in control as long as 95.60/80 protected.
AUD/JPY has come under renewed selling pressure in the past 2 days, mainly via AUD/USD sales, with buying interest in USD/JPY not as strong, with the market still cautious over near term expectations of further QE by the Bank of Japan, as opposed to the more aggressive pricing of rate cuts by the RBA in February.
According to Jim Langlands, Founder at FXCharts: "There have been some rather bearish observations out with regards to the Aud recently; last week Blackrock said it was heading sub 0.7000, and yesterday ANZ noted the critical week coming up, with the growing potential for the Aud to soon head below 0.8000. An ANZ note to client’s stated that “Should next week’s business confidence and CPI numbers look as soft, as we anticipate, a more sustained RBA easing cycle will be priced, and the AUD will break through USD0.8000”."
Technically, AUD/JPY presents a bearish picture short term, with the hourly chart price action being capped by a downward 20 EMA, which has acted as reliable dynamic resistance on the Chinese-inspired bounce circa 95.30. Immediate support comes at 95.00 (current level) followed by 94.85 (US low) and deeper declines towards Jan 14 low at 94.35. On the upside, bears are firmly in control as long as 95.60/80 protected.