The AUD/JPY pair is currently in range-bound mode, as the market participants await further direction on the pair following mixed Australian employment data. The Employment Change in Australia came in at -40.9K, which was worse than the expectation that the Australian economy would add 26.5K jobs.
This is also a steep departure from the 88.4K jobs added in June. However, the Unemployment Rate fell from 3.5% in June to 3.4% in July, which was a market surprise considering the expectation was for the Unemployment Rate to remain static.
This has been a rollercoaster week for the Aussie Dollar. It began the week badly after weak Chinese data dented sentiment on the commodity currency. The risk aversion carried into the second day before some intervention by the People’s Bank of China brightened sentiment and helped the AUD to a slight recovery before yesterday’s data.
The varied nature of the employment report means that the Aussie Dollar heads into the weekend purely at the mercy of technical plays. Potential setups are presented below for traders looking for a potential setup heading into the weekend.
AUD/JPY Forecast
The 4-hour chart shows the price action within a symmetrical triangle. The bulls would need a breakout, targeting 94.563 in the near term. This is the site of previous highs of 16/28 June and 18 July and the previous low of 26 July 2022. A clearance of this new target makes 95.735 (20 July and 27 July highs) available to the bulls as a new upside target.
Above this level, the 8 June high seen at 96.914 becomes the new target to the north. However, the contrarian position will see the 93.196 support becoming the initial downside target of the price is rejected at the triangle’s upper border and breaks the lower border as a result of the pullback move.
This price mark, which houses previous lows of 15 July and 7 August 2022, will have to give way if the bears are to make 92.458 (5 August low) a harvest point. 91.879 and 90.502 (2 August low) are additional targets that lie further south that become viable if there is further price deterioration.
AUD/JPY: Daily Chart
