AUD/JPY Recovery to Face Seasonal Bias

With a Reserve Bank of Australia (RBA) and Bank of Japan (BoJ) seductiveness rate decisions out of a way, AUD/JPY might continue to lane changes in risk view as both executive banks hang to a hands off proceed for financial policy. The new liberation in AUD/JPY has mostly been accompanied by a pickup in global benchmark equity indices, and marketplace participants might serve implement a Yen as a appropriation banking as Governor Haruhiko Kuroda appears to be in no rush to deviating from a Qualitative/Quantitative Easing (QQE) Program with Yield-Curve Control.

Keep in mind a seasonal disposition favors a bearish opinion for a Australian dollar, with AUD/USD depreciating 75% of a time during a month of May over a past 20-years. The bent for a Japanese Yen is some-more mixed, with USD/JPY splitting time equally between gains and waste over a same period. In turn, a anniversary disposition might tame a near-term allege in AUD/JPY generally as equity traders start to demeanour during a ‘sell in May and go away’ strategy.

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AUD/JPY Daily

AUD/JPY Daily Chart

Nevertheless, disaster to mangle subsequent a 81.60 (61.8% expansion) support section keeps a broader opinion slanted to a topside generally as AUD/JPY preserves a ceiling trend carried over from a prior year. Moreover, a RSI appears to be highlighting a near-term trigger as it clears a bearish arrangement from December, and a span might extend a ceiling trending channel from a Apr low (81.49) as prolonged as risk view stays afloat. With that said, a subsequent topside jump around 84.60 (100% expansion) to 85.00 (100% expansion) followed by 85.60 (61.8% retracement).

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— Written by David Song, Currency Analyst

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