2 Sep 2013
AUD/JPY continuing the upside move that began last week; upside target 90.12
FXstreet.com (Barcelona) - The AUD/JPY started its rally last week as investors and traders sought to add risk in the most liquid way possible – in the global currency markets. Today, the AUD/JPY is continuing the rally based on bullish data flow from China as well as Australia.
Aussie data mixed – net bullish; China PMIs improve M/M; Japan data bullish
• Australian data came out on the bullish side of the ledger as a whole even as certain data missed the mark
o Performance of Manufacturing data were an improvement over last month
o Securities inflation came in lower-than-expected
o Building Permits came out far ahead of estimates and previous readings
o Corporate Operating Profits came in negative and below estimates for Q2
• China posted two PMIs – the HSBC number which missed estimates and the NBS number which beat estimates; each number, however, was an increase over the previous monthly number.
• Japanese Capital Spending came in flat month over month – which was an improvement versus the negative numbers last month and better than the still-negative estimates.
The net effect of all the data today is that the AUD/JPY is proceeding higher – in-line with the playbook the technicians laid out last week (see below).
Technical outlook for AUD/JPY
Technicians are sticking with their call for a corrective move higher up to 90.12 for AUD/JPY. Late last week, they called for a short-term correction down to 87.42 before the upside was expected to continue. That level was undercut slightly, but the support held into the close. Shorter-term resistance for AUD/JPY comes in at 89.36.
Aussie data mixed – net bullish; China PMIs improve M/M; Japan data bullish
• Australian data came out on the bullish side of the ledger as a whole even as certain data missed the mark
o Performance of Manufacturing data were an improvement over last month
o Securities inflation came in lower-than-expected
o Building Permits came out far ahead of estimates and previous readings
o Corporate Operating Profits came in negative and below estimates for Q2
• China posted two PMIs – the HSBC number which missed estimates and the NBS number which beat estimates; each number, however, was an increase over the previous monthly number.
• Japanese Capital Spending came in flat month over month – which was an improvement versus the negative numbers last month and better than the still-negative estimates.
The net effect of all the data today is that the AUD/JPY is proceeding higher – in-line with the playbook the technicians laid out last week (see below).
Technical outlook for AUD/JPY
Technicians are sticking with their call for a corrective move higher up to 90.12 for AUD/JPY. Late last week, they called for a short-term correction down to 87.42 before the upside was expected to continue. That level was undercut slightly, but the support held into the close. Shorter-term resistance for AUD/JPY comes in at 89.36.