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AUD/JPY justifies risk-barometer status at yearly high above 94.00 amid Australia holiday, BoJ eyed

  • AUD/JPY grinds near intraday high, stays firmer around the highest levels since late November 2022.
  • Hawkish RBA concerns versus disappointment from Japan PPI, dovish comments from BoJ’s Wakatabe favor pair buyers.
  • Yields, stock futures struggle to justify cautious optimism in the markets amid lack of major data/evens and holiday in Australia.

AUD/JPY stays defensive around 94.00 as the key week comprising multiple central bank announcements and top-tier data begins with the Aussie holidays.

Even if the pre-data anxiety and the King’s Birthday in Australia limit the cross-currency pair’s momentum, the bulls keep the reins at the highest levels since late November 2022, marked the previous day, amid divergence of the monetary policy bias surrounding the Reserve Bank of Australia (RBA) and the Bank of Japan (BoJ). Furthermore, downbeat Japan inflation clues and the BoJ officials’ dovish comments also keep the pair buyers hopeful.

Earlier in the day, Japan’s Producer Price Index (PPI) for May dropped for the fifth consecutive month to 5.1% YoY from 5.8% previous readings and 5.5% market forecasts. That said, monthly figures also disappointed Yen traders with -0.7% MoM outcome, versus -0.2% expected and 0.2% prior.

On the other hand, BoJ Deputy Governor Masazumi Wakatabe rules out any change in the BoJ monetary policy during this week’s meeting as he said, “Don't expect a change from BOJ at this week's meeting.”

It’s worth noting that the Reserve Bank of Australia’s (RBA) surprise rate hike joined the firmer China Caixin Services PMI to underpin the bullish bias about the AUD/JPY pair. Additionally, dovish comments from BoJ Governor Kazuo Ueda add strength to the AUD/JPY pair’s upside momentum.

However, the market’s lack of conviction ahead of the top-tier data/events joins the mixed signals from China to challenge the AUD/JPY pair’s upside. That said, concerns about the People’s Bank of China’s (PBoC) rate hike gains momentum of late as the Chinese central bank’s Governor Yi Gang said in a statement on Friday that China's Q2 GDP YoY growth is expected to be high mainly due to base effects. The policymaker added, “There is plenty of room for policy adjustment.”

Looking ahead, AUD/JPY pair may witness a lackluster day amid the Aussie holiday. However, Thursday’s Australia jobs report and Friday’s BoJ monetary policy announcements are the keys for the pair traders to watch. Given the dovish bias from the BoJ and expectations of upbeat Aussie data, as well as the recent hawkish surprise from the RBA, the quote may remain firmer.

Technical analysis

The overbought RSI (14) line joins multiple hurdles marked during late November 2022, around 94.10-15, to challenge the AUD/JPY buyers. The downside move, however, remains doubtful until breaking the 200-DMA support of 91.77.

Additional important levels

Overview
Today last price94
Today Daily Change0.02
Today Daily Change %0.02%
Today daily open93.98
 
Trends
Daily SMA2091.92
Daily SMA5090.63
Daily SMA10090.64
Daily SMA20091.78
 
Levels
Previous Daily High94.1
Previous Daily Low93.16
Previous Weekly High94.1
Previous Weekly Low92.14
Previous Monthly High92.44
Previous Monthly Low89.16
Daily Fibonacci 38.2%93.74
Daily Fibonacci 61.8%93.52
Daily Pivot Point S193.4
Daily Pivot Point S292.82
Daily Pivot Point S392.47
Daily Pivot Point R194.33
Daily Pivot Point R294.68
Daily Pivot Point R395.26

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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