AUD/JPY slumps to 84.80, risk-off back in vogue?
- The Yen back in demand on risk-off.
- USD weakness drives USD/JPY lower.
- Looks to test 84.50 support.
- US data and FOMC minutes on tap.
The AUD/JPY pair wilted on Wednesday amid a major turnaround in risk condition, which propped up the demand for the safe-haven Yen across the board.
AUD/JPY: Bears back in control
The cross in AUD/JPY stalled its 2-day recovery mode and fell back into the red zone, having faced triple whammy so far this session. The latest BOJ headlines combined with a retreat in the Japanese stocks lifted the sentiment around the Japanese currency.
Moreover, the extension of the USD declines across its main competitors, in response to the comments from the Fed Chair Yellen, dragged USD/JPY sharply lower, which in turn weighed down on the Yen crosses including AUD/JPY.
Furthermore, the cross also suffers on the back of persisting weakness seen around the AUD/USD pair, following the reports of another Australian Senator stepping down over the dual citizenship ruling.
Looking ahead, the spot will take cues from the sentiment on the European equities and upcoming US macro news for fresh incentives. However, the main risk event for today remains the FOMC minutes release.
AUD/JPY Technical View
Higher-side: 85.25/31 (Nov 21 & daily top), 85.61 (10-DMA), 85.95 (200-DMA)
Lower-side: 84.47 (5-month lows), 84.00 (round number), 83.76 (March lows)