AUD/JPY Targeting S1 at 79.71

AUD/JPY Targeting S1 at 79.71

AUD/JPY was carving a bullish tone out for itself at the start of the week, recovering from the 80.63 lows.

AUD/JPY reached a high of 81.22 today, but has since resumed the downside with the Nikkei falling 4% within the opening hour as Japan returns just for one session before more holiday's this week meaning for more thin trade, despite there being high profile data on the cards for the Aussie specifically.

Besides the RBA, we have the Aussie retail sales and trade balance along with Caixan PMI's form China. We have had manufacturing already released over the weekend. NBS Manufacturing PMI and Non-Manufacturing PMI's for April arrived as 50.1 actual vs consensus 50.3 and 53.5 vs 53.8 prior and respectively. The RBA could cut rates tomorrow given the recent picture of the nation's core inflation, strength in the Aussie and general economic conditions tightening.

AUD/JPY levels

AUD/JPY was a hard offer from above 86.00 recently and plummeted through the 200 sma at 84.61 and kept going, smashing through 84.00, 83.00 and grinding hard to make fresh 3-week lows at 80.63. The pivot is 81.43 and the pair is en route for S2 at 79.71 on a break of yet another handle. The pair is bearish until a break of the 200 dma at 85.70 where a reversal would be taking shape for a recovery to Dec highs on the 90 handle.