AUD/JPY pulls back after mixed Aussie data, risk-reshuffle

AUD/JPY fails to extend bounce off 100-day EMA.
Mixed Aussie PMI data, Brexit headlines recently weigh on the pair.
Statistics from Japan, risk catalysts will be on the traders’ radar.

Anil Panchal FXStreet

Not only mixed activity numbers from Australia but recent downbeat headlines concerning the Brexit also weigh on the AUD/JPY pair as it pulls back to 74.45 during the early Asian session on Thursday.

The preliminary readings of October month activity numbers from the Commonwealth Bank of Australia (CBA) and Markit portray mixed momentum. The reason being an upbeat manufacturing outcome confronting weak services PMI, which in turn results in a lesser than prior 52.0 to 50.7 reading of the Composite Purchasing Managers’ Index (PMI).

Elsewhere, risks of a snap election in the United Kingdom (UK) seem to increase off-late with the Finance Minister Sajid Javid supporting the same on the ITV interview while the opposition Labour Party’s finance spokesman showing readiness whenever it comes.

The pair bounced off from 100-day Exponential Moving Average (EMA) on Wednesday after upbeat trade/Brexit headlines favored the market’s risk tone. Also adding to the pair’s strength was the news that the Bank of Japan (BOJ) was considered to have a gloomier view on the economic outlook.

Investors will now keep a close eye over Japan’s Preliminary reading of October month Jibun Bank Manufacturing PMI, expected 48.8 versus 48.9, followed by Leading Economic Index and Coincident Index for August, which are both likely to remain unchanged at 91.7 and 99.3 respectively.

It should also be noted that the recent news concerning the US-China trade deal has been positive and trade/Brexit headlines will keep occupying the driver-seat for now.

Technical Analysis

The pair needs a successful break above the monthly top surrounding 74.85 in order to visit 75.15/20 area including late-June to early-July lows. Alternatively, a downside break of a 100-day EMA level of 74.00 could recall 50-day EMA level of 73.38 to the chart.

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 hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.