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AUD/JPY down 1.2 cents, bears eye 100.00

FXStreet (Bali) - AUD/JPY's relentless uptrend rolled over for a second day in a row, something not seen since Oct 10, with Tuesday's sell-off - down 1.2 cents - towards a new 2-week low at 100.40 being the worst daily loss since aforementioned Oct 10.

As explained in recent reports, what goes up must come down, and with JPY selling being so overstretched in recent weeks, courtesy of Japan's QQE2/GPIF changes/sales tax delay/snap election, danger to an acceleration of profit taking had to be factored in.

Last Friday, Japan's FinMin Aso opened the can of worms by upping his rhetoric towards Yen depreciation happening 'too fast', a comment which set the stage for a more prudent approach towards holding Yen short at such hefty levels.

Also last Friday, an unexpected rate cut by China led to the believe that AUD would find greater support near term, and while a flash spike was seen in favour of Aussie across the board, after a few days to digest the news, the market's verdict to the Chinese action has proven short-lived, seen as signs of trouble ahead in the 'Big Panda' economy on its ability to keep up growth and inflation expectations.

Technically, the major breakout through 101.40/101.00 down towards 100.40 re-orients the technical picture in favour of selling strength near term, with a retest of 101.40 ahead of 102.00, key 'value levels' where a significant increase in selling interest will likely be noted. On the downside, should the bear pressure resume, 100.00 will be the projected first target ahead of 99.70 - Nov 5th high - ahead of 98.70 - peak Sept 5th -.

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