AUD/JPY Price Analysis: Reverses from 50-DMA, key resistance line on disappointing Australia data
- AUD/JPY takes offers to refresh intraday low, snaps three-day uptrend while reversing from two-week high.
- Australia Monthly CPI, Building Permits for July push back RBA hawks.
- Sluggish oscillators join U-turn from key technical hurdles and hawkish BoJ bias to tease sellers.
AUD/JPY takes a U-turn from a two-week high while declining to 94.15 on the downbeat Australian inflation data amid early Wednesday. In doing so, the cross-currency pair also justifies disappointing housing market numbers from the Pacific major while reversing from the 50-DMA and a downward-sloping resistance line from June 19.
Australia’s Monthly Consumer Price Index (CPI) flashed the 4.9% YoY figures for July versus 5.2% expected and 5.4% prior while the Building Permits slumps with -8.1% figure for the said month compared to -0.8% market forecasts and -7.7% figures reported in June.
Given the sluggish oscillators and the recent hawkish concerns about the Bank of Japan (BoJ), the AUD/JPY may extend the latest pullback towards the 94.00 round figure. However, the one-week-old support line near 93.90 may prod the bears afterward.
In a case where the AUD/JPY pair breaks the immediate support, it can easily slump to the 100-DMA level of around 93.25.
Meanwhile, the aforementioned resistance line and the 50-DMA, respectively near 94.50 and 94.70, guard the immediate recovery of the AUD/JPY pair.
However, the pair sellers remain hopeful unless they witness a clear upside break of the previous support line stretched from late March, close to 95.80 at the latest.
AUD/JPY: Daily chart
Trend: Further downside expected