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AUD/JPY could see some action in the upcoming Asia session with potential catalysts on deck from Australia, China and Japan.

Before moving on, ICYMI, today’s Daily U.S. Session Watchlist looked at a NZD/CAD ahead of OPEC-related news, so be sure to check that out to see if there is still a potential play!

Intermarket Update:

Equity Markets Bond Yields Commodities & Crypto
DAX: 15008.61 +1.29%
FTSE: 6772.12 +0.53%
S&P 500: 3958.55 -0.32%
NASDAQ: 13045.39 -0.11%
US 10-YR: 1.717%  -0.004
Bund 10-YR: -0.289% -0.013
UK 10-YR: 0.822% -0.005
JPN 10-YR: 0.085% +0.018
Oil: 60.35 -1.97%
Gold: 1,683.30 -1.82%
Bitcoin: 58,602.75 +1.93%
Ethereum: 1,840.46 +2.10%

Fresh Market Headlines & Economic Data:

U.S. stocks fell Tuesday as major technology shares came under pressure again after the 10-year Treasury yield touched its highest level since January 2020.

IMF to boost global outlook again, warns financial conditions uncertain

Oil falls as Suez Canal opens, dollar rallies; eyes on OPEC+ meeting

Quarles says Fed very commited to pushing inflation above 2%

NY Fed’s Williams says he is optimistic about the economy

Covid cases, vaccinations on the rise as U.S. officials urge continued caution

The estimated annual inflation of Spanish CPI in March 2021 is 1.3%

ECB Governor warns against sharp policy tilt when crisis passes

Covid antibodies in half of UK population and festivals to go ahead

Upcoming Potential Catalysts on the Economic Calendar

Japan Industrial production at 11:50 pm GMT
Australia Building Permits, Private Sector Credit at 12:30 am GMT (Mar. 31)
China Manufacturing & Services PMI at 1:00 am GMT (Mar. 31)
Japan Housing Starts, Construction orders at 5:00 am GMT (Mar. 31)
U.K. GDP, Current account, Housing Prices at 6:00 am GMT (Mar. 31)
France Inflation Rate at 6:45 am GMT (Mar. 31)
Germany Unemployment at 7:55 am GMT (Mar. 31)
Italy Inflation Rate at 9:00 am GMT (Mar. 31)

What to Watch: AUD/JPY

AUD/JPY 1-Hour Forex Chart
AUD/JPY 1-Hour Forex Chart

On the one hour chart of AUD/JPY above, we’ve got a short-term trend to the upside in play, but the market is running into a potential resistance area just under the 84.50 area. This area was a consolidation area just last week, so traders may be waiting there to potentially take profits from last week’s rally or put on fresh short positions.

We’ll likely have to wait and see what the bias will be as we do have several economic catalysts on the calendar ahead. Most are low to mid tier events, so there isn’t one notable one to watch, but if we see a general consensus of positive or negative updates, we may get a directional bias on AUD/JPY through the Wednesday session.

With the longer-term price trend favoring the bulls on AUD/JPY and if broad risk sentiment can lean positive, we’ll be looking for an upside break of the resistance area under 84.50 on positive data from both Australia and China.

If we see a pullback ahead of today’s events, even better for the bulls, and if the data comes out better-than-expected, bullish reversal patterns forming around 83.00 – 83.50 would likely draw in the bulls, especially if broad risk sentiment is leaning positive.

Rising bond yield  have been an issue for a while, and if they continue to rise (and or we see other negative catalysts on risk sentiment), then look out for the yen to strengthen against the Aussie on potential risk aversion flows.

This scenario plus weaker-than-expected updates from Australia and China would likely make a short play a viable short-term strategy to consider, and if we see a break below 83.50 in that scenario, look out for the next move to be to the previous swing lows around 82.70 – 83.00 (well within the daily ATR range of around 70 pips).