- AUD/JPY keeps pullback from the intraday high of 74.83.
- Australian Treasurer hints extension of the coronavirus countermeasures, DFAT upgrades travel warning for China.
- Receding cases in Victoria fails to defy lockdown in Melbourne and surrounding cities.
- Japan’s Nishimura urges for immediate support to combat the pandemic.
AUD/JPY recedes from the intraday high of 74.83 to 74.68 during the early Wednesday. The pair snapped a three-day winning streak on Tuesday but the following weakness in the Japanese currency trouble traders at the moment.
Talking about the positives, Victoria’s coronavirus (COVID-19) cases recede from 191 to 134 on Tuesday. Further, Australian Treasurer Josh Frydenberg recently hinted an extension to income support schemes beyond the initial limit of September.
On the contrary, a six-week-long lockdown, announced the previous day, remains intact in Melbourne whereas Australia’s Depart of Foreign Affairs and Trade (DFAT) warned that their citizens living in and traveling to China may be arbitrarily detained, per Sydney Morning Herald. Additionally, the broad risk-off sentiment, backed by the rising cases in the US and Tokyo, as well as the Sino-American tension, acts as an extra burden on the market’s risk-tone sentiment.
While portraying the grim mood of traders, Wall Street benchmarks marked a negative daily closing the previous day while stocks in Australia and Japan carry the moves as we write. Further, the US 10-year Treasury yields seesaw around the multi-week low of 0.65% whereas S&P 500 Futures print mild gains around 3,140 amid risk-reset.
It’s worth mentioning that Japanese Economy Minister Yasutoshi Nishimura recently urged for the immediate coronavirus countermeasure. Further, the Bank of Japan (BOJ) cites the record 6.2% hike in June month bank deposits as well as a surge in the Certificate of Deposits (CDs) to mark the investors’ rush in the safe-haven currency.
Although risk catalysts are likely to keep the pair pressured, the yen moves may take clues from the US dollar’s performance and Japan’s June month Eco Watchers Survey data.
Technical analysis
Failures to cross the mid-June top surrounding 75.10 drag the quote towards a two-week-old ascending support line near 74.30. Though, 21-day SMA close to 74.00 might probe the bears afterward.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.