Sun, April 21, 2024

Australian Dollar’s Turbulent Trade: USD And JPY Market Analysis

Wibest – the aud: Austalian dollar bills.

Quick Look:

  • The Australian Dollar consolidates against the USD and finds support at 0.6450.
  • Global risk appetite influences AUD’s strength against USD.
  • AUD/JPY sees a modest increase, with resistance at Tenkan-Sen, 100.50, and 101.00.

As of Tuesday, the AUD/USD pair entered a consolidation phase, experiencing a slight rally during the session. The currency found major support at the 0.6450 level. Its resistance levels loom near the 50-day and 200-day Exponential Moving Averages (EMAs), and a ceiling shows up at 0.6650.

The global risk appetite significantly influences the Australian Dollar’s trajectory. It could either bolster or dampen its strength against the US Dollar in the short term. As such, investors are navigating the markets with cautious optimism, balancing their strategies amid uncertain economic cues.

AUD/JPY: Mixed Signals Amid Market Speculations

The AUD/JPY pair has seen a modest increase of 0.38% on Tuesday amid mixed market signals, intervention concerns, and a risk-off impulse emanating from Wall Street. The resistance levels to watch include the Tenkan-Sen at 99.17, followed by the year-to-date high. Additionally, significant markers were set at the psychological levels of 100.50 and 101.00.

Kijun-Sen, at 98.53, established support for the AUD/JPY. With subsequent levels at 98.00, the 50-day moving average at 97.87, and the Ichimoku Cloud top at 97.80. The Relative Strength Index (RSI) suggests that buyers currently have the upper hand, indicating a potential for further gains in the short term.

Australian Dollar: Economic Speculations Test Support Levels

On Monday, ahead of the domestic inflation reading and with a keen eye on global equity markets, investors showed a guarded stance towards the AUD/USD pair. The currency traded at .7159 at 09:34 GMT, marking a decrease of -0.23% from its previous close. The Invesco CurrencyShares Australian Dollar Trust ETF closed at $71.22, down by $0.42 or -0.58%.

The Australian economy is expected to report a CPI increase of 3.2% for the December quarter year-over-year. Moreover, the core inflation marked its fastest pace since 2014 at 2.4%. From a technical standpoint, the main trend is downward, with the currency testing a key retracement zone between .7153 and .7116 and facing resistance between .7275 and .7341.

In a bearish scenario, a sustained move under .7153 could signal that sellers are gaining momentum, with potential targets at .7130 to reaffirm the downtrend and .7116 possibly triggering a steep sell-off. Conversely, a bullish outlook is indicated by a move over .7154, potentially leading to a short-covering rally.

Australian Dollar’s Path Amid Global Economic Shifts

As the market navigates through myriad influences, including economic indicators and global market sentiment, the Australian Dollar’s performance against the US Dollar and the Japanese Yen remains a focal point for investors. The upcoming Non-Farm Payroll data and domestic inflation readings are key events that could significantly impact these currency pairs. Therefore, advisers urge traders to stay informed, adjust their strategies, and monitor key levels and market indicators.

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