AUD/JPY: Off intraday top after Aussie trade numbers

AUD/JPY fades upside momentum near 74.45 after downbeat Aussie trade numbers.
Australia’s June month Trade Balance softened to 8,025M versus 9,000M forecast and 8,800M prior.
Market sentiment carries the usual pre-NFP mood, virus updates, US-China tussle add filters.

Anil Panchal FXStreet

AUD/JPY eases from the intraday high of 74.45 to 74.38 amid Wednesday’s Asian session. Australia’s trade figures for June become the latest catalysts for the pair’s U-turn. Also challenging the recent upside momentum could be the market’s grim mood ahead of the key US employment data. Furthermore, the Sino-American tension and fears of the worsening coronavirus (COVID-19) conditions in the US exert additional pressure on the pair.

Aussie Trade Balance stepped back from 9,000M forecast and 8,800M earlier readouts to 8,025M in June. Details suggest that the Exports shrank lesser than -11.3% previous to -4.0%. Further, Imports also recede in declines to -6.0% against -9.8% prior.

Read: Australia's Trade Balance: AUD +8.025 bn (expected AUD +9bn), bearish for AUD

On the other hand, Japan’s June month Monetary Base rose from 3.9% earlier to 6.0% but Foreign Investment in Japan stocks for the period ending on June 26 dropped from ¥-421.9 B to ¥-494.4 B. Also, Foreign Bond Investment also recedes from ¥1547.5 B to ¥174.6 B during the mentioned period.

Talking about the risks, US virus cases surged the most since the pandemic started, as per Reuters, while marking a daily increase of over 48,000 on Wednesday. Alternatively, China announced measures to have an eye over the US media operating on their lands after Trump administration went a step farther in sanctioning Beijing over the Hong Kong Security law. Furthermore, market players doubt the upbeat expectations from the US employment figures for June considering the latest outbreak of the virus, which in turn becomes another challenge to the risk-tone.

While portraying the market mood, the US 10-year Treasury yields stop the previous run-up towards 0.70% around 0.68% by the press time. However, stock indices in Japan and Australia, namely Nikkei 225 and ASX 200, remain mildly positive.

Given the lack of major data/events left for publishing, the pre-NFP trading lull could bore analysts. Though, updates concerning the virus and Sino-American relations might offer intermediate entertainment.

Technical analysis

Having bounced off 21-day SMA, currently around 74.25, the quote again aims for the mid-June top near 75.10. Though, a clear break beyond Wednesday’s top of 74.70 becomes necessary to justify the strength of the upside momentum.

Additional important levels

Overview
Today last price	74.39
Today Daily Change	0.07
Today Daily Change %	0.09%
Today daily open	74.32

Trends
Daily SMA20	74.24
Daily SMA50	71.83
Daily SMA100	70.22
Daily SMA200	72.3

Levels
Previous Daily High	74.7
Previous Daily Low	73.92
Previous Weekly High	74.42
Previous Weekly Low	72.73
Previous Monthly High	76.79
Previous Monthly Low	71.61
Daily Fibonacci 38.2%	74.22
Daily Fibonacci 61.8%	74.4
Daily Pivot Point S1	73.92
Daily Pivot Point S2	73.53
Daily Pivot Point S3	73.14
Daily Pivot Point R1	74.7
Daily Pivot Point R2	75.09
Daily Pivot Point R3	75.49

Author

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.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold holds above $5,000 as bears seem hesitant amid Fed rate cut bets

Gold edges lower at the start of a new week, though it defends the $5,000 psychological mark through the Asian session. The underlying bullish sentiment is seen acting as a headwind for the bullion. However, bets for more rate cuts by the Fed, bolstered by Friday's softer US CPI, keep the US Dollar bulls on the defensive and continue to support the non-yielding yellow metal as the focus now shifts to FOMC Minutes on Wednesday.

Week ahead: Data blitz, Fed Minutes and RBNZ decision in the spotlight

The US jobs report for January, which was delayed slightly, didn’t do the dovish Fed bets any favours, as expectations of a soft print did not materialize, confounding the raft of weak job indicators seen in the prior week.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.