Friday’s trade saw AUD/JPY within the range of 89.55-90.75. The pair closed at 90.43, rising 0.48% on a daily basis, or at the most considerable rate since December 1st, when it appreciated 1.10%. The daily high has been the highest level since August 20th, when the cross registered a high of 91.34. In weekly terms, AUD/JPY surged 2.32% during the current week, marking its sharpest gain since the week ended on October 11th, when it appreciated 4.41%. The pair has advanced 1.59% so far during the current month.
On Monday (December 7th) AUD/JPY trading may be influenced by a number of macroeconomic reports and other events as listed below.
Fundamentals
Australia
AiG Performance of Construction Index
At 22:30 GMT on Sunday the Australian Industry Group (AIG) is expected to announce the results from its survey on short-term and intermediate-term conditions in the sector of construction during November. Surveyed companies answer questions associated with production, employment, prices, supplier deliveries, inventories and new orders. The seasonally adjusted Performance of Construction Index (PCI) for Australia came in at a reading of 52.1 in October, which marked the third consecutive month, when the gauge inhabited the area above 50.0. Values above that key level are indicative of predominant optimism (expansion in activity). An improvement in the value of this indicator would provide a limited support to Australian dollar.
ANZ Job Advertisements
At 0:30 GMT on Monday the Australia and New Zealand Banking Group (ANZ) will publish data regarding the number of job advertisements in Australia in November. It encompasses advertisements in the major metropolitan newspapers and on the Internet sites. The corresponding index, based on a survey by ANZ, climbed 0.4% in October compared to September, marking a third consecutive month of increases. In September job advertisements were 3.9% more compared to a month ago. This indicator is used for projecting growth in employment in Australia, as it reflects labor market conditions in the future. An increase in the number of jobs would have a limited bullish effect on the Australian dollar, while a decrease would have the opposite effect.
Japan
BoJ Kuroda speech
At 3:45 GMT Bank of Japan Governor Haruhiko Kuroda is expected to speak at a monetary policy press conference in Tokyo. Moderate-to-high volatility of the currency pairs containing the Japanese yen is usually present during such events.
Correlation with Major Pairs
Taking into account the week ended on December 6th and the daily closing levels of the currency pairs involved, we come to the following conclusions in regard to the strength of relationship:
AUD/JPY to AUD/USD (0.9438, or very strong)
AUD/JPY to NZD/USD (0.8918, or very strong)
AUD/JPY to EUR/USD (0.6025, or strong)
AUD/JPY to GBP/USD (0.1385, or weak)
AUD/JPY to USD/JPY (-0.0135, or very weak)
AUD/JPY to USD/CAD (-0.2653, or weak)
AUD/JPY to USD/CHF (-0.6382, or strong)
1. During the examined period AUD/JPY moved strongly in one and the same direction with EUR/USD, while moving strongly in the opposite direction compared to USD/CHF.
2. AUD/JPY moved almost equally in one and the same direction with AUD/USD and NZD/USD during the week.
3. The correlation between AUD/JPY and GBP/USD, AUD/JPY and USD/CAD was insignificant.
4. AUD/JPY moved almost independently in comparison with USD/JPY during the period in question.
Daily and Weekly Pivot Levels
By employing the traditional calculation method, the Monday pivot levels for AUD/JPY are presented as follows:
Central Pivot Point – 90.24
R1 – 90.94
R2 – 91.44
R3 – 92.14
S1 – 89.74
S2 – 89.04
S3 – 88.54
By using the traditional method of calculation again, the weekly pivot levels for AUD/JPY are presented as follows:
Central Pivot Point – 89.73
R1 – 91.45
R2 – 92.48
R3 – 94.20
S1 – 88.70
S2 – 86.98
S3 – 85.95
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