AUD Gets a Pullback . Are We just Before The Big Move up ?
Updated
AUD/JPY Analysis:
First of all, we can agree that AUD/JPY
AUDJPY is overall bullish.However, after reaching the order block at the current levels, we might see a price retracement after a rejection. Historical performance suggests that we could experience a pullback later this week.
JPY Strength: The JPY
JPYX seems to be gaining strength, at least for now.Market Structure: We’ve got a swing CHoCH (Change of Character) on a higher time frame, indicating that a pullback before a continuation of the upward trend seems to be the right approach.
Gold Correlation: Gold
GOLD is also at its highest, and a potential price pullback could align with the expected retracement in AUD/JPY.Short-Term Outlook:
Short Position: In the short term, a pullback presents a good shorting opportunity for AUD/JPY.
We just got to The golden Fib level Had a Bearish Liquidity grab and got the minor reversal signal on the Oscillator Matrix. would be great to confirm the structure change on the lower Time Frame
Long-Term Outlook:
Long Position: Long term, the overall bullish trend remains intact, so longs are still the preferred direction.
For a major short, we would need to see the price reach significantly higher levels than where it is now.
Trade active
We’ve seen a strong downward move and are now looking for a continuation after a slight pullback.Trade active
The article discusses market influences on the AUD/JPY (Australian Dollar/Japanese Yen) pair and what could impact its movement in the near future. Here's a simplified summary:
AUD/JPY Trend Shift:
The pair has weakened after a three-day winning streak, currently trading around 101.20.
The Japanese Yen gained strength after statements from Japanese officials, but its rise could be limited due to political instability in Japan.
Political Impact in Japan:
There are concerns that Japan's current ruling party (LDP) may lose its majority in the upcoming elections, which increases economic uncertainty.
Japan is also closely monitoring currency fluctuations and expressing concerns about their impact on the economy.
Australian Central Bank (RBA):
The Reserve Bank of Australia (RBA) may avoid cutting interest rates in 2024, which supports the Australian Dollar.
Positive employment data in Australia strengthens the outlook that the central bank will maintain a restrained monetary policy.
Economic Data:
In Australia, the Judo Bank Services PMI slightly increased to 50.6 in October, indicating continued growth in the private sector, despite a decline in the manufacturing sector.
Overall Meaning:
The AUD/JPY pair is influenced by both Japan's political and economic situation and Australia's economic policy. On one hand, the Australian Dollar is supported by positive data and a cautious monetary approach, but on the other hand, Japan's political instability may limit the rise of the Yen.
Trade active
### Updated Analysis Based on Actual Data:
1. **Quarterly CPI (q/q)**:
- **Forecast**: 1.1%
- **Actual Result**: 0.3%
- **Previous**: 1.0%
- **Implication**: The result is significantly lower than expected and lower than the previous quarter, indicating a decline in quarterly inflation. This could weaken the Australian dollar as the Reserve Bank of Australia (RBA) might not rush to raise interest rates.
2. **Yearly CPI (y/y)**:
- **Forecast**: 2.7%
- **Actual Result**: 2.3%
- **Previous**: 2.7%
- **Implication**: The result is below the forecast and the previous yearly data, suggesting a slight decrease in annual inflation. This could reduce the pressure on the RBA to raise rates, potentially weakening the Australian dollar.
3. **Trimmed Mean CPI (q/q)**:
- **Forecast**: 0.9%
- **Actual Result**: 0.8%
- **Previous**: 0.8%
- **Implication**: This result matches the previous quarter but falls below the forecast. As a measure that excludes extreme values, this stability at a low level hints at a slowdown.
### Overall Summary:
Given that all indicators came in below forecasts or remained at low stability, the Reserve Bank of Australia may adopt a less aggressive approach to rate hikes, which could lead to a weakening of the Australian dollar in the near term.
Comment
Today, we saw a significant breakthrough with a strong downside move, reaching a key support level on AUD/JPY. The trade played out beautifully, with a brief rally to the upside before the downtrend took hold. Though it took some time to set up, patience paid off, and we got the expected result. We’ll continue to watch closely for further downside continuation in the trend.
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