- AUD/JPY trims nearly 30 pips off its previous day’s gains.
- Australia’s October month Trade Balance, Retail Sales disappoint AUD buyers.
- Japan's government nears economic stimulus, US-China trade talks are going “very well”.
AUD/JPY plummets to 74.36 amid the Asian session on Thursday. The pair reacts to the downbeat Retail Sales and Trade Balance numbers from Australia.
Australia’s October month Trade Balance slipped below 6,100M forecast to 4,502M while Retail Sales lagged behind 0.3% market consensus to 0.0%. This joins the previously released downbeat Aussie Gross Domestic Product (GDP) data and indicates hardships for the Australian dollar (AUD).
Further, Reuters’ news that Japan’s government is near to economic stimulus package worth about 13 trillion Japanese yen (JPY) also drags the pair down.
Trade sentiment again witnesses downside pressure as the Washington Post conveys that the United States (US) House Judiciary Committee Chairman Jerrold Nadler said President Trump’s conduct with Ukraine rose to an impeachable offense. Also contributing to the market pessimism could be the talks surrounding the US-Iran relation after The Telegraph said that the Trump administration considers 14,000 more troops for the Middle East.
While portraying the risk tone, the US 10-year treasury yields again drop below 1.70% by the press time. The risk barometer surged to 1.78% on Wednesday.
The pair traders were earlier cheering the US President Donald Trump’s comments that the trade talks with China are going “very well”.
With no major data on the economic calendar, investors will keep eyes on trade/political headlines for fresh direction.
Technical Analysis
Pair’s rise beyond the monthly top surrounding 74.85 holds the key to further increase towards a 200-day Simple Moving Average (SMA) level near 75.30 and November month high around 75.70. Sellers look for entry below two-week-old rising trend line, at 73.90 now.
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