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Australia recently printed a downside surprise in its quarterly CPI report.

Will this be enough to keep AUD/JPY within its range?

Before moving on, ICYMI, today’s Daily Asia-London Session Watchlist looked at a possible pullback on EUR/JPY after a bullish breakout. Be sure to check that out to see if there is still a potential play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

  • Canadian retail sales at 1:30 pm GMT
  • ECB head Lagarde’s speech at 3:00 pm GMT
  • U.S. crude oil inventories at 3:30 pm GMT
  • FOMC statement at 7:00 pm GMT
  • FOMC press conference at 7:30 pm GMT

What to Watch: AUD/JPY

AUD/JPY 1-hour Forex Chart
AUD/JPY 1-hour Forex Chart

I’m steering clear of dollar pairs for now since the FOMC might cause a ruckus later in the day.

Instead I’m looking closely at this short-term range on AUD/JPY since the pair is sitting right on the resistance. If sellers keep defending this area and risk aversion returns, price could retreat back to the bottom at 83.25.

It’s also worth noting that Australia just printed weaker than expected inflation figures earlier today while Japan released an upbeat retail sales report.

If the Fed decision manages to stoke risk appetite, however, the pair might break past the range resistance and go for a rally that’s the same height as the rectangle pattern.