AUD/JPY is eyeing break above 61.8 percent Fib after above-forecast Chinese PPI
- A better-than-expected China PPI is good news for commodities and the Aussie dollar.
- The data will likely add to the bullish tone around AUD and could push the AUD/JPY cross above 83.04 - 61.8 percent Fibonacci retracement of 84.54 - 80.63.
The AUD/JPY is maintaining its bullish stance following the key data releases in China and Australia and is looking to scale the immediate resistance at 83.04 (61.8 percent Fibonacci retracement of 84.54 - 80.63).
China producer price index (PPI) - a good indicator of demand for commodities, rose 4.7 percent in June, beating the estimated rise to 4.5 percent from the previous month's print of 4.1 percent. Consequently, the AUD (commodity dollar) stands to gain.
Further, China consumer price index (CPI) came in at -0.1 percent month-on-month, missing the estimated rise of 0.1 percent, so the PBOC has plenty room to pursue an accommodative monetary policy (positive for commodities and AUD).
This, coupled with the risk-on action in the global markets could push AUD/JPY above 83.04 (61.8 percent Fibonacci retracement).
The NAB Australia business confidence and business conditions index released along with the Chinese data offered little positive/negative surprises.
AUD/JPY Technical Levels
Resistance: 83.04 (61.8 percent Fibonacci retracement), 84.16 (June 12 high), 84.54 (June 6 high).
Support: 82.68 (session low), 82.53 (100-day moving average), 82.45 (50-day moving average).