aud/jpy daily fundamental analysis

AUDJPY has been on the front foot ever since it rebounded off a key support zone around its 100-day SMA and 38.2% retracement point from this year's low. when, the pair is finding some resistance around its 61.8% retracement point from this month's high and its 200-4hr SMA. A break here could propel the pair to its 50-day SMA, currently around 95.05 level.

AUD mainly ignore strong economic data

From a fundamental perspective, the Aussie should be, but apparently isn't, benefiting from better than expected Chinese manufacturing figures over the weekend and a rebound in Australia's AIG Performance of Manufacturing Index this month (data  released in this morning). China's May Manufacturing PMI jumped to 50.8 from 50.4, beating an expected increase to 50.7. In Australia, AIG's May Manufacturing Index rose 4.4 points to 49.2.

However, the Australian dollar is largely ignoring this better data in favour of concerns about falling commodity prices and the possibility that the RBA may attempt to talk down the AUD at tomorrow's policy meeting (look out for our RBA preview later today). Also, China and New Zealand are offline today due to public holidays, thus trading conditions are likely to be fairly thin.

now a important frequency for AUDJPY

In the near-term, we are waiting for the release of Australia's building approvals figures for April (exp. 2.0%; 0130GMT) and we concerned about a possible bearish flag pattern in AUDJPY. If the pair breaks through trend line support  it may make another run for its 100-day SMA. In saying that, a break of its50-day SMA may see momentum build which could push the pair towards long-term trend line resistance (see chart).