AUD/JPY selloff mirrors decline in S&P 500
AUD/JPY falls to a fresh weekly low (87.87) after failing to hold above 50-Day SMA (89.73), and the exchange rate may track the negative slope in the moving average as it pares the rebound from the monthly low (87.60).
AUD/JPY Rate Outlook
AUD/JPY may threaten the opening range for April as it carves a series of lower highs and lows, with the selloff in the exchange rate largely mirroring the decline in the S&P 500 index as there appears to be a shift in risk-taking behavior.
The correlation coefficient stands at significant reading of +0.74 as both AUD/JPY and the S&P 500 slip to fresh weekly lows, and a further deterioration in investor confidence may keep the exchange rate under pressure ahead of the Bank of Japan (BoJ) interest rate decision on tap for later this week.
Until then, AUD/JPY may face a further decline if it fails to defend the monthly low (87.60), with a break/close below the 87.20 (50% Fibonacci extension) to 87.40 (61.8% Fibonacci retracement) region opening up the yearly low (86.06).
At the same time, AUD/JPY may attempt to retrace the decline from the monthly high (90.78) if it defends the opening range for April, with a move above 88.60 (38.2% Fibonacci extension) bringing the 89.60 (50% Fibonacci retracement) area back on the radar.
Additional Resources:
AUD/USD tumbles toward March low following 'Death Cross' formation
--- Written by David Song, Strategist
DavidJSong
AUD/JPY Rate Outlook
AUD/JPY may threaten the opening range for April as it carves a series of lower highs and lows, with the selloff in the exchange rate largely mirroring the decline in the S&P 500 index as there appears to be a shift in risk-taking behavior.
The correlation coefficient stands at significant reading of +0.74 as both AUD/JPY and the S&P 500 slip to fresh weekly lows, and a further deterioration in investor confidence may keep the exchange rate under pressure ahead of the Bank of Japan (BoJ) interest rate decision on tap for later this week.
Until then, AUD/JPY may face a further decline if it fails to defend the monthly low (87.60), with a break/close below the 87.20 (50% Fibonacci extension) to 87.40 (61.8% Fibonacci retracement) region opening up the yearly low (86.06).
At the same time, AUD/JPY may attempt to retrace the decline from the monthly high (90.78) if it defends the opening range for April, with a move above 88.60 (38.2% Fibonacci extension) bringing the 89.60 (50% Fibonacci retracement) area back on the radar.
Additional Resources:
AUD/USD tumbles toward March low following 'Death Cross' formation
--- Written by David Song, Strategist
DavidJSong
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