AUD / JPY breaks through 84.00 to accelerate five-day uptrend on Chinese PMI surprise and falling markets

  • AUD / JPY extends 84.14 pullback heavy around intraday low.
  • China’s Caixin Manufacturing PMI is below market consensus and before in March.
  • Risks are diminishing amid the sober market reaction to US President Joe Biden’s infrastructure spending.

AUD / JPY justifies surprisingly weak Chinese PMI and mixed market sentiment while remaining under pressure around the intraday low of 83.80 early Thursday. As the latest downside catalysts weigh on the listing, positive factors from early Asia challenge the pair’s further weakness.

The production of Caixin in March PMI from China drops below 51.3 forecast and 50.9 before 50.6. In doing so, the private sector survey differs from the optimistic official readings released earlier in the week.

Read: AUD / USD: Refresh from weekly low to below 0.7600 on declining Chinese Caixin PMI

Within hours, Australia’s trade balance for February fell from a forecast 9,700 million to 7,529 million, from 10,142 million previously, while retail sales fell less than initial estimates by -1.1% to – 0.8% during the period indicated. Further details suggest that imports rose beyond -2.0% from previous readings to + 5.0% and exports fell from 6.0% to -1.0% for the period reported.

Also completing the Aussie The calendar was the data for February mortgage loans and lending for lending homes, which were mixed, as well as the AiG Performance of Mfg index for March, 59.9 compared to 58.8 previously.

While Australian and Chinese data could not offer a clear direction to AUD / JPY movements, the good figures from Japan’s Tankan survey for the first quarter of 2021 and the mood at risk appear to be playing their part in containing the downturn. quote.

It is worth mentioning that news suggesting no foreclosure extension to Brisbane Australia and an absence of new cases of covid in NSW should have favored the failed purchase of AUD / JPY bulls. The reason could be attributed to fears of a daunting task for US President Joe Biden to get his plan and a new variant of Covid approved in Brazil, not to mention the struggle between the West and China.

Amid those games, the S&P 500 Futures hovered above 3,950 as 10-year US Treasury yields did not represent a major move. However, Asia-Pacific markets remain mostly positive in hopes of further stimulus.

Second, the Asian calendar has fewer details to watch out for and therefore risk catalysts will be the keystone of further momentum.

Technical analysis

Unless it breaks below the 83.85-60 support area comprising the 10 and 21 day SMA, AUD / JPY remains on the bull’s radar.

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