- Volatility in stock markets caps gains in the AUD/JPY pair.
- Rally in commodities is underpinning the Aussie dollar.
AUD/JPY lacks a clear directional bias, with the rally in commodities restricting the downside in the Aussie dollar, while stock market volatility keeping the bulls at bay.
“The Dow Jones Industrial Average went on quite a rollercoaster ride, starting the day up more than 100 points at record highs only to turn negative an hour later before recovering back into positive territory,” BK Asset Management’s Kathy Lien noted in her analysis.
Further, the rally in the Asian stocks has paused on Thursday, possibly tracking Wall Street’s volatile price action. As such, the AUD is struggling to gather upside traction at press time.
However, sellers are not willing to lead the price action either. That’s because commodities are rallying on expectations of a faster global economic recovery. Notably, Comex copper advanced to $3.7955 a pound ($8,350 a tonne) on Wednesday to hit the highest level since 2012. Copper is one of Australia’s top exports.
However, the pair may face selling pressure if the rising bond yields weigh over stock markets, boosting demand for the anti-risk yen.
Technical levels
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