Forex
Home›Forex›Major Pairs›AUD/JPY firms near 112.55 but stays capped by 100-day…
AUD/JPY firms near 112.55 but stays capped by 100-day SMA
The yen softens versus the Australian dollar after reports that Japan’s state pension asset allocation will not change immediately, while resistance sits at 112.60.
AUD/JPY rose toward 112.55 in early European trading on Tuesday, supported by some yen selling versus the Australian dollar. FXStreet linked the move to reduced expectations for near term support for Japanese assets after Reuters reported that Tokyo has no immediate plans to alter the asset allocation of its state pension funds.
Even so, Japan’s Finance Minister Satsuki Katayama said the country’s massive pension fund would adjust holdings if necessary. She also proposed adding government bonds to a tax free investment program for individual investors, according to FXStreet.
On the technical side, FXStreet said the pair retains a mildly bearish bias as it trades just below the 100 day simple moving average, currently around 112.60. The analysis points to resistance at the 100 day SMA and then the Bollinger upper band near 113.40, while support is seen first around the Bollinger middle band near 112.30 and then around 111.25 at the lower band.
FXStreet also noted that the yen’s value is shaped by factors including Bank of Japan policy, the yield differential with the US, and global risk sentiment, with Japan having sometimes intervened in currency markets. It added that the recent gradual unwinding of the Bank of Japan’s ultra loose policy has provided some support for the yen, even as the pair remains range constrained.