AUD/JPY touches a one-month high and closes in on the 200-day MA
The aussie continues to perk up after a slight setback on Friday on hopes of a US-China trade resolution being dashed. But the currency is continuing its good run and today we’re seeing potentially a key technical breakout in AUD/JPY.
The pair has rebounded after a double-bottom pattern being formed at the end of last month and has now broken above yesterday’s high of 81.94 and also threatens a break of the trendline resistance since July.
What’s more interesting in the chart is a potential test of the 200-day MA (blue line). That currently sits at 82.17 and if tested, it will be the first time since February since buyers have been able to trade at that key technical level.
While all is looking good for risk now, there’s still a tricky day to navigate through. The US midterm elections promises to be a defining near-term landmine for risk assets and AUD/JPY – the epitome of risk in the currencies space – will be a part of that.
But as mentioned earlier, any result that doesn’t end up in a 50-50 or the Democrats winning both the House and Senate will eventually bode well for equities and risk in my view. In getting election risks out of the way, it paves the way for a potential break higher in AUD/JPY once buyers are able to clear the 200-day MA as well.