AUD/JPY trading near the recent bottom, Asia markets to remain thin
- AUD/JPY sedate in thin markets.
- RBA Meeting Minutes sail by largely unnoticed.
AUD/JPY traded flat in thin Monday markets and is heading into Tuesday testing just beneath the 0.7920.
Monday saw the US markets taking a break to observe President's Day, and the Asia session will continue to remain subdued with Chinese institutions dark for the first half of the week to celebrate Chinese New Year.
The Reserve Bank of Australia (RBA) dropped their Meeting Minutes today, but little surprises were to be found as all of the information has already been processed and priced in by market participants, with the RBA mostly reiterating what has already been said in recent weeks, with inflation growth expected to remain gradual, and wage growth subdued amid tighter lending and mortgage restrictions and high levels of household debt.
The RBA noted that an increasing Aussie would hamper growth potential within Australia's economy, and with the Bank of Japan (BoJ) rhetoric falling along the same lines, AUD/JPY can expect a battle of wills going forward as both countries' central banks vie to achieve low exchange rates.
AUD/JPY Technicals
The Aussie rebounded from the 200-day SMA recently, and is currently trading just above the 34 EMA, though any gains in the pair are likely to come from markets reacting to BoJ rhetoric talking down the Yen, as the Aussie has struggled to develop real forward momentum amidst middling economic growth. H4 charts show the pair trading into support at 0.7898, and if this level fails to hold 0.7871 will be the next support, while a bullish continuation from here will see resistance at 0.7951 and 0.7983.