- The AUD / JPY ignores the Australian wage price index in the first quarter.
- Risk aversion weighs on the pair, the trade war with China, fears of a viral resurgence are the main catalysts.
- RBNZ can offer immediate steering while providing qualitative catalysts to stay in the driver’s seat.
AUD / JPY hovers around 69.30, down 0.06% on a day, after Australian data matched market consensus on Wednesday morning. Despite this, the pair remains under pressure due to the broad risk aversion.
First quarter (T1) salary in Australia Price index corresponds to 2.1% of forecasts, compared to 2.2% previously, on an annual basis, while repeating the figures of 0.5% for QoQ.
Earlier in the day, Westpac’s consumer confidence for the month of May increased 16.6% from -17.7 previously. However, the data failed to remind buyers, with the exception of the initial withdrawal, in a climate of risk.
Global markets were late risk averse. The reason could be attributed to China’s struggle against the United States and Australia. While the United States appears to have the upper hand over the dragon nation, the Aussie Pressure from PM Scott Morrison to investigate the virus epidemic likely resulted in a ban on meat exports.
Elsewhere, the resurgence of cases of coronavirus (COVID-19) from Germany and Wuhan seems to send an early warning to Pacific nations who applaud the return in their own right.
In the midst of all these games, the 10-year US Treasury yields still fall below 0.70% to 0.66% while the Japanese NIKKEI and the Australian ASX 200 also posted losses. more than 1.0% at press time.
Given the lack of major Australian or Japanese guidelines for the rest of the day, traders in the pair can keep an eye out for trade / virus updates for short term guidance.
The recent removal of the EMA key pair keeps sellers hopeful while targeting a confluence of 50 EMA days and 61.8% Fibonacci retracement from fall February to March, around 68.90 / 85. On the contrary, a daily close beyond the 100-day EMA level of 70.11 will not be enough for the pair to target a March peak of 71 , 52, because the April peak near 70.20 will validate further.