AUD/JPY jumps to fresh daily peak after RBA decision, lacks follow-through buying

AUD/JPY gains strong positive traction on Tuesday, though the upside potential seems limited.
The AUD strengthens after the RBA decided to leave the Official Cash Rate (OCR) unchanged.
China’s economic woes and geopolitical risk might keep a lid on any further gains for the cross.

Haresh Menghani FXStreet

The AUD/JPY cross attracts some dip-buying near the 96.25 region during the Asian session on Tuesday and jumps to a fresh daily peak after the Reserve Bank of Australia (RBA) announced its policy decision. Spot prices currently trade around the 96.70 region, though remain confined in a familiar range held over the past three days.

The Australian Dollar (AUD) strengthens a bit after the RBA, as was widely anticipated, decided to keep the Official Cash Rate (OCR) unchanged at the end of the February meeting. In the accompanying policy statement, the RBA noted that wage growth has picked up but is not expected to increase much further and remains consistent with the inflation target. Furthermore, the RBA published new economic forecasts and now sees 2024 GDP growth at 1.8% as compared to the 2% estimated previously. This, in turn, suggests that the RBA's tightening cycle is over and that the next move would be down, which might hold back bulls from placing aggressive bets around the AUD/JPY cross.

Apart from this, persistent worries about slowing economic growth in China might further contribute to keeping a lid on the China-proxy Aussie. Moreover, the risk of a further escalation of geopolitical tensions in the Middle East might continue to benefit the Japanese Yen's (JPY) relative safe-haven status and contribute to capping the AUD/JPY cross. The downside, however, seems cushioned in the wake of comments from China's sovereign wealth fund, saying that they will increase the investment of China stock ETFs and are determined to safeguard the stable operation of the market. Hence, acceptance below the 100-day SMA is needed to confirm a bearish breakdown.

Technical levels to watch

AUD/JPY

Overview
Today last price	96.59
Today Daily Change	0.22
Today Daily Change %	0.23
Today daily open	96.37

Trends
Daily SMA20	97.09
Daily SMA50	96.75
Daily SMA100	96.36
Daily SMA200	95.1

Levels
Previous Daily High	96.77
Previous Daily Low	96.22
Previous Weekly High	97.7
Previous Weekly Low	95.5
Previous Monthly High	97.88
Previous Monthly Low	95.84
Daily Fibonacci 38.2%	96.43
Daily Fibonacci 61.8%	96.56
Daily Pivot Point S1	96.13
Daily Pivot Point S2	95.9
Daily Pivot Point S3	95.58
Daily Pivot Point R1	96.69
Daily Pivot Point R2	97
Daily Pivot Point R3	97.24

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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