AUD/JPY slips, loses the 83.00 handle as Syria crisis deepens

• AUD/JPY walking back gains as markets brace for expanding Middle East conflict.
• The Yen is likely to bounce higher if allied forces begin missile strikes in Syria.

The AUD/JPY is heading into the Asia session trading near 82.90 after declining slightly in Wednesday's markets.

The pair managed to catch some lift this week as China appeared willing to stand down somewhat in the ongoing trade spat with the US, but Chinese President Xi Jinping's words at the Boao Forum were as carefully chosen as they were neutral-toned, and traders are beginning to worry that the tariff battle between the two countries may continue on for a while longer.

Further sapping risk appetite this week is the Syria conflict, which threatens to drag in key players from around the world. The US and several key allies within the UN are planning strikes against Syria's Russia-backed Assad and his forces in retaliation for a chemical weapons strike in Douma that may have killed fifty people and injured a thousand more.

The embroiled Middle East conflict is kicking market sentiment back down and the Yen is seeing a mild resurgence as traders keep one foot squarely in the safe haven space, and the AUD/JPY walked back some of the early week's gains.

AUD/JPY levels to watch

Wednesday's move lower could be pricing in a lower high for the pair on the Dailies, and a failure to continue the bullish momentum from here will see the 34-day EMA act as resistance and send the pair lower from 82.75, while a successful bid higher will see the EMA acting as support looking forward. A bearish break will also see support from the last swing low at the major 82.00 handle, while a bullish drive will see resistance at March's high of 84.50.