AUDJPY – Aussie Dollar Forming Double Top Vs Yen?15 February, 2017 by Aayush Jindal in Market Analysis
- The Aussie dollar traded higher this week against the Japanese yen, but faces resistance near 87.50-70.
- The AUDJPY pair is likely forming a double top near 87.50, but there is a chance of a break higher as well.
- Today, the Australian Westpac Consumer Confidence released by the Faculty of Economics and Commerce Melbourne Institute posted an increase from 97.4 to 99.6 in Feb 2017.
- Later today, the US Consumer Price Index for Jan 2017 will be released by the US Bureau of Labor Statistics, which is forecasted to increase by 2.4% (YoY).
AUDJPY Technical Analysis
The Aussie dollar remained supported against the Japanese yen, but it looks like the AUDJPY is currently facing a monster resistance near 87.50-70.
The stated level was a resistance earlier, and once again acting as a barrier. A failure to break the 87.50 resistance might call for a double top pattern. If the pair starts a decline, there can be a test of a bullish trend line on the daily chart at 86.00.
On the other hand, if the pair breaks higher, there can be a move towards the 1.236 extension of the last decline from the 87.53 high to 83.74 low at 88.42.
Australian Westpac Consumer Confidence
Today, the Australian Westpac Consumer Confidence, which captures the level of sentiment that individuals have in economic activity was released for Feb 2017 by the Faculty of Economics and Commerce Melbourne Institute.
The market was expecting a minor increase in the index from 97.4 in Feb 2017. However, the increase was noticeable, as the index rose to 99.6 in Feb 2017. This might just help AUDJPY in overcoming bearish pressure.
US Consumer Price Index
Today, the US will see the Consumer Price Index release for Jan 2017 by the US Bureau of Labor Statistics. The forecast is slated for an increase of 2.4% in Jan 2017, compared with the same month a year ago. And, the monthly CPI change is forecasted to increase by 0.3%.
Overall, the forecast is of a stable CPI reading, and if the result fails to match, the US Dollar might decline in the short term. The EURUSD pair in that case might recover above the 1.0650 level.