16.05.201908:49 Forex Analysis & Reviews: AUDJPY: AUD to regain momentum over JPY for short-term? May 16, 2019

AUD is struggling to gain momentum over JPY recently which strengthened further after Australia's Unemployment report showed an unexpected increase while having better Employment Change.

RBA Assistant Governor Bullock spoke today about the upcoming payment system in Australia which will enhance transactions and customer experiences in the near future. Bullock did not quite involve the Employment results in the speech which lead to confusion among market participants. Today Australian Employment Change report was published with an increase to 28.4k from the previous figure of 27.7k which was expected to decrease significantly to 15.2k. The positive employment change was quite remarkable. However, Australia's jobless rate rose to 5.2% from the previous value of 5.1%, contrary to the forecast for a decrease to 5.0%.

On the other hand, Bank of Japan's Deputy Governor Wakatabe stated that benefits of central bank's ultra-loose monetary policy still outweigh the costs. Meanwhile, consumer inflation has not reached the targeted level of 2% yet. Citing Wakatabe, the outcome of qualitative and quantitative easing is viewed as clearly positive which will prop up the domestic economy further in the medium term.

Today Japan's PPI report was published with a downtick to 1.2% from the previous value of 1.3% which was expected to decrease to 1.1%. Ahead of Tertiary Industry Activity to be published tomorrow, which is expected to increase to 0.1% from the previous value of -0.6%, JPY is going to trade with higher volatility in the coming days.

To sum up, the recent economic reports made little impact on the pair. Australian reports revealed quite mixed readings. So, in this context the pair is going to trade with higher volatility. AUD may gain ground thanks to the positive employment change, but JPY is ruling in the pair.

Now let us look at the technical view. The price is currently trading at the support area of 75.50 where along the way certain Bullish Divergence is spotted. The price was bearish early today. The pair did not quite sustain it. Currently it is showing certain rejection off the support area which can push the price higher towards 77.50 before resuming the bearish trend.