AUD/JPY bounces-off 3-week lows near 87.40, 88 handle on sight

The AUD/JPY pair is seen reversing a part of the intraday sell-off to fresh three-week lows of 87.41, as the bear loosened their grip tacking the recovery in the AUD/USD pair.

AUD/JPY back above 50-DMA at 87.65

The cross fell to the lowest levels seen since Sept 11, as the Aussie came under heavily selling on RBA rate cut talks, after the WSJ reported the Reserve Bank of Australia (RBA) board member Ian Harper‘s comments earlier today. Harper said that he sees scope for interest rate cuts if consumption across the economy loses momentum entirely.

However, the last hour, AUD/JPY makes recovery attempts in tandem with the AUD/USD pair amid a fresh bout of profit-taking, while a pick-up in buying interest around the USD/JPY pair also collaborates to the renewed uptick in the prices.

Focus now shifts towards the US NFP release for fresh impetus on the AUD and JPY. Meanwhile, the pair will continue to track the USD dynamics and risk trends for further momentum.

AUD/JPY Technical levels                 

To the topside, a daily close above 88 (round number) would shift risk in favor of a re-test of 88.19/28 (5 & 10-DMA) beyond which 88.68 (20-DMA) would be back on sight. A break below 87.16 (100-DMA) would open doors for 85.74 (200-DMA). A break lower would yield a test of 86.50 (psychological levels).