AUD/JPY Faces Double Whammy Amid Risk-Off

AUD/JPY Faces Double Whammy Amid Risk-Off

13 May 2016, 06:23
Roberto Jacobs

AUD/JPY Faces Double Whammy Amid Risk-Off

AUD/JPY fell back in the red and now extends further south during mid-Asia, as risk-off induced yen strength adds to the poor sentiment seen around the AUD/USD and weighs down on the cross.

AUD/JPY recovers from 79.30 levels

The AUD/JPY pair now drops -0.45% to 79.50, recovering slightly from fresh session lows struck at 79.31 earlier today. The cross is seen attempting a minor-bounce, although remains heavily offered as it faces double whammy from renewed sell-off in the AUD/USD pair on one hand, while the yen regains control versus its American counterpart, which also added to the losses in AUD/JPY.

The underlying risk-off tone in the markets continue to have significant negative effect on the risk barometer, AUD/JPY, as sharp declines in the Asian stocks combined with sliding oil prices crush appetite for risk. Next on the focus remains the US data flow, which is expected to provide fresh direction on both the JPY and AUD.

AUD/JPY Technical Levels

To the upside, the next resistance is located at 79.79/80 (5-DMA/ round number) and above which it could extend gains to at 80.67/81 (May 11 High/ daily R2).To the downside immediate support might be located 78.95 (daily S2) below that at 78.14 (multi-week low).


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