AUD/JPY clings to sub-76.00 area with trade/political catalysts in play
- Trade positive news confronts geopolitical pessimism.
- Japanese PM Abe’s victory at upper house election favors the extension of current policies.
Given the mixed market sentiment confusing the AUD/JPY pair traders, the quote takes the rounds to 75.90 during early Monday morning.
The Australian Dollar (AUD) has recently been cheering brighter chances of the US-China trade deal and the greenback weakness helping overall commodity baskets.
The Japanese Yen (JPY), on the other hand, continues to benefit from the political tussles surrounding the US, the EU, the UK and Middle East nations. Recently, Iran seized the UK’s oil tanker and it has been at odds with the US whereas the Brexit development and the EU’s trade outlook with the US have also been tumultuous off-late.
Adding to the JPY strength could be the recent victory of the Japanese Prime Minister (PM) Shinzo Abe in the upper house parliament for the election of half the seats. The ruling party gained majority and signals continuation of the expansionary policies.
The global gauge of market risk sentiment, the US 10-year treasury yield, remain mostly unchanged around 2.05% by the press time.
Given the lack of data/events on the economic calendar, investors will keep an eye over the qualitative catalysts for fresh impulse.
Technical Analysis
Not only 76.00 but late-May top surrounding 76.17 and the current month high close to 76.30 also act as immediate resistance while 50-day simple moving average (SMA) level of 75.48 offers nearby key support ahead of highlighting 76.15 and 76.00 as rest-points.