Partner Center Find a Broker

With an unusually light economic calendar and the Jackson Hole Conference ahead, I don’t see many swing opportunities jumping out at me. Instead, I’m checking out AUD/JPY for a potential short-term, technical play.

AUD/JPY Intraweek Short Play?

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

The world’s central banks will be meeting this week at the annual Jackson Hole Economic Policy Symposium, and traders are likely to sit on the sidelines to avoid any potential surprises from the event.

And as mentioned above, with an extremely light economic calendar ahead (only low tier data from Australia and Japan), I don’t think we’ll see a decent amount of volatility this week. Instead, I think short-term trades are probably the way to go, and it’s likely technicals will be the main driver aside from shifts in broad global risk sentiment.

So this week, I’m checking out a simple setup on AUD/JPY, which has been ranging for the past two weeks with a negative lean. Traders seem to have been making moves off of the 76.15 handle, using it as both support and resistance during this period.

With broad risk sentiment still in more of a sour mood thanks to growing uncertainty with the COVID-19 pandemic, geopolitical tensions with the U.S. and China, and the failure of the U.S. government to provide another stimulus package, I’m taking a bearish lean on the pair and will be watching for a retest of the 76.15 handle this week.

If the currency pair does retest and we do see a fresh bearish catalyst on broad risk sentiment (e.g., growing tensions between the U.S. and China, spikes in COVID-19 cases/deaths, dovish commentary from central bankers this week, etc.), I will put on an idea for a day trader or very short-term swing position.

So, no orders for now, but I do have my alerts set to ping me if 76.15 is reached this week. If triggered and everything looks good, I’ll be sure to update here in the blog.

What do you guys think? Are you watching AUD/JPY for a potential position as well? Anyone bullish on the pair instead? Let me know in the comments section below!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.