AUD/JPY tanks in New York, dips below 86.00

• AUD/JPY plummets as global risk assets retreat.
• DOW has worst day on record, erasing January gains; Nikkei set to continue plunge.
• RBA rate decision at 03:30 GMT, no increase expected on soft data.

AUD/JPY accelerated its recent decline, dropping to 85.89 to finish the New York trading day. Price found a bounce in the Asia pre-market and is currently trading just above the 86.00 handle. Global markets have turned sour, and as traders abandon riskier assets in favour of safe havens, notably the Japanese Yen, the effects of a risk-off market theme will continue to be felt in the AUD/JPY chart. The pair is trading at its lowest price since mid-December, tumbling 3.44% from the January high of 89.07.

Australia has Retail Sales and Trade Balance data for December today at 00:30 GMT, and the RBA releases their first Interest Rate Decision of the year at 03:30. With markets already pricing in a lack of rate increases from the RBA, and growth proving itself to be sluggish and elusive, little help to lift the AUD out of its risk-off doldrums can be expected. 

With global equities tumbling in New York, and the Dow having its biggest losing day on record, Tokyo markets led by the Nikkei Index can expect much of the same behaviour, and traders can expect to see a continuation of traders piling into the Yen as markets cash themselves out of recent gains.

AUD/JPY Technicals

Price has closed under the 200-day SMA, and Daily technical indicators have accelerated their bearish signals, while price is currently trading at a Daily swing support level the 86.00 psychological level. Nearest swing resistance on H4 charts is resting at 87.30, and a continued breakdown in AUD/JPY could see price challenging the major swing level of 84.50 very soon.

Today's pivot points: 
R2: 88.05
R1: 86.98
PP: 86.44
S1: 85.37
S2: 83.75