AUDJPY – Double Top In Making For Aussie Dollar?20 July, 2016 by Aayush Jindal in Market Analysis, Technical Analysis
AUDJPY – Double Top In Making For Aussie Dollar?
- The Aussie dollar traded higher against the Japanese yen, but facing a major resistance on the upside.
- There is also likely a double top pattern forming on the 4-hours chart of the AUDJPY pair.
- Today in Australia, the Westpac Leading Index was released by the Melbourne Institute.
- The market was not expecting any major rise in the index in May 2016, and the outcome was negative, as there was a decline of 0.20%.
AUDJPY Technical Analysis
The Aussie dollar recently climbed higher to trade near the last high of 81.50 against the Japanese where it found sellers again. It looks like the AUDJPY pair is setting up a short-term top as there is a double top pattern forming on the 4-hours chart.
Currently, the pair is attempting to close below a bullish trend line formed on the same chart. A successful close may call for more declines in the near term.
The next support on the downside can be around the 200 simple moving average (4-hours chart).
Australian Westpac Leading Index
Earlier today in Australia, the Westpac Leading Index, which tracks nine gauges of economic activity, including share prices and telephone installations, to provide an indication of how the economy will perform was released by the Melbourne Institute.
As mentioned, the market was not expecting any rise in May 2016. The result was somehow disappointing, as there was a decline noted of 0.20%. Commenting on the report, the Westpac Chief Economist, Westpac’s Chief Economist, Bill Evans, stated, “While the growth rate of the Index remains below zero, indicating a continuation of the below trend momentum seen over the last 14 months, it has improved significantly since the start of the year. Indeed this latest reading suggests growth over the next 3 to 9 months will be almost around trend”.
Overall, there was hardly anything for the Aussie dollar bulls, which means it remains at a risk a breakdown in the short term.
Euro Zone Consumer Confidence
Today in the Euro Zone, the Consumer Confidence, which is a leading index that measures the level of consumer confidence in economic activity will be released by the European Commission. The preliminary reading for July 2016 is expected to decline from -7.3 to -8.