AUD/JPY Price Forecast: Falls to near 109.00 while staying above 100-day EMA, bullish bias intact

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The AUD/JPY cross tumbles to near 109.05 during the early European session on Monday. Renewed trade war fears, rising geopolitical tensions in the Middle East, and uncertainty provide some support to a safe-haven currency such as the Japanese Yen (JPY) against the Aussie.

AUD/JPY slumps to around 109.05 in Monday’s early European session.
The cross remains well above the 100-day EMA, keeping a bullish bias intact.
The first support level emerges at 108.82; the immediate resistance level to watch is 110.65.

On the other hand, a hawkish stance from the Reserve Bank of Australia (RBA) might help limit the Australian Dollar’s losses (AUD). Stronger-than-expected economic data have reinforced expectations that the Australian central bank would keep a tightening bias to address persistent inflationary pressures.

Technical Analysis:

In the daily chart, AUD/JPY holds above the 100-day EMA, reinforcing the broader uptrend. Price hovers just over the 20-day middle Bollinger Band, while the bands remain wide, pointing to elevated volatility. RSI at 56.29 is neutral, reflecting cooled momentum from recent overbought readings. Initial support aligns at the middle band 108.82, with a deeper floor at the lower band 106.98.

On the topside, resistance stands at the upper Bollinger Band at 110.65. A daily close above this barrier could extend the upmove. The rising 100-day EMA at 104.35 underpins the structure and would buffer deeper declines.

(The technical analysis of this story was written with the help of an AI tool.)

Japanese Yen FAQs

What key factors drive the Japanese Yen?

The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

How do the decisions of the Bank of Japan impact the Japanese Yen?

One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.

How does the differential between Japanese and US bond yields impact the Japanese Yen?

Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.

How does broader risk sentiment impact the Japanese Yen?

The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

Acuity Trading

Acuity Trading هي شركة تكنولوجيا مالية مقرها لندن تأسست عام 2013، متخصصة في البيانات البديلة المدعومة بالذكاء الاصطناعي وتحليل المشاعر للتداول والاستثمار. أحدثت ثورة في تجربة التداول عبر الإنترنت عبر أدوات الأخبار البصرية والمشاعر، وتواصل اليوم ريادة السوق ببيانات بديلة مولدة للألفا وأدوات تداول جذابة مدعومة بأحدث أبحاث وتقنيات الذكاء الاصطناعي.

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