Earlier today Japan’s Tankan survey for Q3 painted a stronger than expected picture of corporate sentiment. Tankan Large Manufacturing Index jumped to 13 – exp. 10; prior 12 – and Tankan Large All Industry CAPEX rose 8.6% – exp. 7.0%; prior 7.4%. Japan’s Non-Manufacturing Tankan Index missed expectations at 13 (exp. 17), but this is largely being ignored in the face of the stronger than expected data from the manufacturing sector.
The yen found some bids on the back of the Japanese economic data, but it failed to make any significant headway against AUD, or any other majors for that matter. Yet, Chinese and Australian economic figures due out shortly may have more of an impact on AUDJPY. China’s official September Manufacturing PMI is due out at 0100GMT, with the market expecting a figure around 51.0. Shortly after this data, Australia’s retail sales figures for August are due to be released (0130GMT; expected 0.4% m/m).
From a technical standpoint, AUDJPY remains in medium-term downward trend (see chart), but there are some bullish indicators which suggest that upward pressure is building. There is bullish divergence between price and RSI on a 4hr chart and MACD suggest that momentum is to the upside.
Source: FOREX.com
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