Partner Center Find a Broker

Despite a quiet holiday environment, we’ve actually got a potential short-term setup in the works on AUD/JPY ahead of top tier Chinese data.

Intermarket Snapshot

Equity Markets Bond Yields Commodities & Crypto
DAX: 13249.01 -0.66%
FTSE: 7594.59 -0.66%
S&P 500: 3221.36 -0.58%
DJIA: 28453.46 -0.67%
US 10-yr 1.917% +0.044
Bund 10-YR -0.181% +0.075
UK 10-YR: 0.86% +0.104
JPN 10-YR: -0.017% -0.012
Oil: 61.75 +0.05%
Gold: 1518.40 +0.02%
Bitcoin: 7258.21 -0.92%
Etherium: 130.45 -2.20%

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Forex Calendar for U.S. & Asia:

  • China Manufacturing & Services PMI at 1:00 am GMT (Dec. 31)
  • U.S. Home prices at 2:00 pm GMT GMT (Dec. 31)
  • U.S. Consumer confidence at 3:00 pm GMT (Dec. 31)

What to Watch: AUD/JPY

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

Looking for some last minute pips? Well, AUD/JPY might be the market to check out with a potential rise in volatility, especially for the Aussie, coming with the latest Chinese PMI data on deck. This data typically can be a short-term market mover, and with a low liquidity environment, the chances of a spike in price is elevated.

On the one hour chart of AUD/JPY above, we can see the pair has been in a steady uptrend this holiday season, rolling with the positive risk-on vibes lifting the equity markets higher like the imminent signing of the Phase 1 U.S.-China trade deal and the very high odds of interest rates remaining very low in the coming new year. The move was enough to break above the early December swing high just under the 76.00 handle, and now with global risk sentiment and AUD/JPY pulling back ahead of the end-of-year (possibly on profit taking), AUD/JPY could draw in short-term buyers at the broken resistance area.

If you’re a bull on AUD/JPY and the Chinese PMI data surprises us with better-than-expected/previous reads, that broken resistance area becomes a highly probable short-term support area. Watch out for bullish reversal candles around the 76.00 area.

If the Chinese PMI disappoints, then that could hit not only the Aussie, but short-term global risk sentiment. A break below the rising ‘lows’ pattern on the news could draw in more sellers, and with a daily ATR of around 40 – 45 pips, 75.00 – 75.50 could be the next downside target.