- The AUD/JPY jumped more than 20 pips after a better-than-expected Aussie retail sales release.
- The bear flag breakdown witnessed ahead of the release of the data has trapped the bears on the wrong side of the market.
The AUD/JPY pair jumped more than 20 pips to a session high of 80.77 after the Australian Bureau of Statistics reported a better-than-expected Aussie retail sales number.
The consumption, as represented by the seasonally adjusted retail sales, rose 0.3 percent in August, beating the estimated rise of 0.2 percent. The 0.3 percent rise follows a largely unchanged reading in July and is boding well for the battered Aussie dollar.
More importantly, the uptick in the AUD/JPY pair has trapped the bears on the wrong side of the markets. The 15-minute chart shows, the Aussie cross has suffered a bear flag breakdown – a bearish continuation pattern – just ahead of the data release and hence looked set to extend the decline toward the psychological support of 80.00.
Indeed, the bearish pattern has failed, still, it is too early to call a bull reversal as the trendline sloping downwards from the Oct. 2 high and Oct. 3 high is intact.
AUD/JPY Technical Levels
Resistance: 80.83 (falling trendline hurdle), 81.06 (50-hour exponential moving average), 81.32 (Oct. 3 low)
Support: 80.52 (session low), 80.38 (previous day’s low), 80.00 (psychological support)
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