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Forex: AUD/JPY still consolidating within ‘pennant’ pattern on daily chart

FXstreet.com (Barcelona) - The AUD/JPY finished the session up 87 pips at 101.55. At one point the pair traded as high as 101.55, but was unable to main a firm bid at these levels and drifted lower later in the NY session. In what has been a busy week of economic data released out of Asia, we will see one more major report with the RBA Monetary Policy Rate due out at 1:30GMT.
The pair is currently trading slightly higher in Asia trade, up five pips at 101.55

According to Sean Callow of WestPac Global Strategy, “The RBA Statement on Monetary Policy (11:30am Syd/9:30am Sing/HK) will generate a slew of headlines but probably limited net AUD response. Unlike Treasury, which may lower its growth forecasts in Tue’s budget, the RBA already has cautious GDP forecasts, 3% for FY12/13 (Westpac 2.9%) and 2-3% for FY13/14 (Westpac 2.5%). CPI forecasts will be shaved lower after the soft Q1 CPI. Any commentary on AUD will of course be closely watched.”

From a technical perspective, the pair remains stuck in a pennant consolidation pattern which has been forming since early April. Most of the other yen crosses have broke out to the upside of this pattern, but the AUD/JPY remains trapped right in the middle. However, the pair is nearing the apex of the pattern, which tells us it should be resolved in the next few trading days. Keep an eye on the upper boundary (now at 102.10) and the lower boundary (100.50) for hints to the direction of the next major move.

Japan Bank lending (YoY) improves to 1.7% in Apr from 1.6%

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Forex Flash: RBA statement should have limited AUD response - Westpac

The RBA Statement on Monetary Policy (1.30GMT) will generate a slew of headlines but probably limited net AUD response, notes Sean Callow, FX strategist at Westpac.
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