AUD/JPY clocks fresh 2-1/2 month high on Yen selling

Omkar Godbole FXStreet Contributor

The uptick in the treasury yields and the resulting sell-off in the Japanese Yen, pushed the AUD/JPY cross higher to 84.88 this Tuesday morning; its highest level since April 3.

The 10-year treasury yield jumped from 2.139% to 2.198% on Monday on Fed’s Dudley’s hawkish take on the economy. The Dollar-Yen pair, which closely follows the long duration treasury yields, rose to 11.60 and extended gains in the Asian session today to 111.77 levels.

Meanwhile, the AUD/USD is relatively resilient; now trading marginally lower on the day below 0.76 handle. Thus, the AUD/JPY cross remains is well bid and was last seen trading around 84.77 levels.

Focus on RBA minutes

Economists will pour over the RBA minutes of the June board meeting due for release today at 01:30 GMT. The central bank, at its June meeting, left the interest rates unchanged at a record low of 1.5%. Also scheduled for release at 01:30 GMT are Australia Q1 figures for house prices, with forecasts suggesting an increase of 2.2% on quarter and 8.9 % year-on-year.

AUD/JPY Technical Levels

A break above 85.19 (Jan 31 low + 61.8% Fib R of Mar high - Apr low) would open up upside towards 85.77 (Mar 31 high) and 86.00 (zero levels). On the other hand, a break below 84.66 (session low) and 84.49 (50% Fib R of Mar high - Apr low) would expose support at 84.02 (Apr 26 high) and 83.73 (May 24 high).
Note - Risk of a bearish price RSI divergence on the 4-hour chart.

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Bearish	Neutral	Shrinking
1H	Bearish	Overbought	Expanding
4H	Bullish	Overbought	Low
1D	Bullish	Overbought	Expanding
1W	Bearish	Neutral	Shrinking
Updated Jun 20, 00:45 GMT

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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