Risk aversion has dragged AUD/JPY to a key short-term support level.
Will we see a bounce today?
Before moving on, ICYMI, yesterday’s watchlist checked out EUR/JPY breaking above an established resistance. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Putin announces special military operations to “demilitarize and denazify Ukraine”Ukraine calls up reservists, declares national emergency as U.S. and allies hit Russia with new sanctions
Australia’s private capital expenditure grew by 1.1% vs. 2.6% expected in Q4 2021
U.S., Australia, Japan considering the release of oil reserves if Ukraine attacks hit global supplies
Asian markets, European futures down on Ukraine invasion
Comdolls and BTC lower while oil, gold and safe-havens trade higher on risk aversion trading
Upcoming Potential Catalysts on the Forex Economic Calendar:
U.S. preliminary GDP at 1:30 pm GMT
U.S. initial jobless claims at 1:30 pm GMT
U.S. new home sales at 3:00 pm GMT
U.S. EIA crude oil inventories at 4:00 pm GMT
New Zealand’s quarterly retail sales at 9:45 pm GMT
New Zealand’s trade balance at 9:45 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: AUD/JPY
Any economic data release in the last trading sessions was eclipsed by speculations and then confirmation of Russia invading Ukraine.In case you missed it, Putin has announced Russia’s “special military operations” beyond the separatist Donbas region. Putin says he only wants to “demilitarize and denazify” and has no intention of invading Ukraine but the U.S., EU, NATO, and other world leaders be like “Nah man, looks pretty invasion-y from here.”
High-yielding bets like the Aussie have unsurprisingly lost value against safe-havens like the yen. AUD/JPY has dropped by 100 pips or so before finding support at the 82.25 levels.
Take note that 82.25 lines up with a range support level that AUD/JPY bulls and bears have been minding for all of February. Now that Stochastic is also showing an oversold signal, you can bet pips that at least some bulls are taking notice.
Bullish momentum above the current levels could inspire a trip to the 82.75 mid-range levels. It could even go back to the 83.00 – 83.25 range resistance zone if we see some form of risk-taking or profit-taking from today’s moves.
If we do see more risk aversion, or if U.S. session traders catch up on all the yen-buying, then AUD/JPY could break its range support and head for previous areas of interest like 81.90 or 81.60.