AUD/JPY: Aus retail data saves the day amid RBA’s jawboning

The cross in AUD/JPY dipped to fresh three-week lows of 87.35 in a knee-jerk reaction to the RBA’s quarterly SoMP release. However, the bulls were quickly rescued by better-than expected Australia’s retail sales data, which sends the pair back above the mid-point of 87 handle.

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The cross also finds impetus from higher commodities’ prices, which remain supportive of the resource-linked AUD, while renewed US political jitters combined with downbeat US fundamentals continue to weigh down on the greenback across the board.

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Meanwhile, the USD/JPY pair remains better bid amid a better risk environment and stalled USD selling, aiding AUD/JPY’s recovery. Next of note for the pair remains the US payrolls data, /macroeconomics/economic-indicator/nfpwhich will have a major impact on both the AUD and JPY in the coming days.

Technical Levels

The cross was last seen trading at 87.53. On the lower side, breach of support at 87.35 (3-week low) could yield a pullback to 87 (round number) and to 86.78 (Jul 13 low). A break above 87.88 (5-DMA) would expose 88.24/25 (20 & 10-DMA) and 88.50 (psychological levels).