The AUD/JPY pair is currently trading lower, positioned at approximately 110.85 during the early European session on Wednesday. The cross maintains a slightly optimistic outlook in the short term, accompanied by a decrease in bullish RSI momentum. The primary resistance level to monitor is 113.20, while the first support level is identified at 110.00. The AUD/JPY cross continues its downward trend, approaching 110.85 in the early European session on Wednesday. The Australian Dollar experiences a decline against the Japanese Yen following cooler-than-anticipated inflation data from Australia and ongoing uncertainty regarding US-Iran negotiations.
The Australian Bureau of Statistics released data on Wednesday indicating that the Consumer Price Index increased by 3.7% year-over-year in February, compared to a previous rate of 3.8%. This figure fell short of the market consensus of 3.8%. In February, the monthly CPI registered at 0%, a decrease from the prior reading of 0.4%, aligning with market expectations. The Iranian military announced on Wednesday that it launched missiles targeting Israel and military installations accommodating US forces in Kuwait, Jordan, and Bahrain. The United States has presented Iran with a comprehensive 15-point plan aimed at resolving the ongoing conflict in the Middle East.
Indicators of an extended conflict may strengthen safe-haven currencies like the JPY and pose challenges for the cross. Nonetheless, a reduction in tensions regarding the US-Iran conflict could potentially mitigate the declines of the Australian dollar. In the daily chart, the near-term outlook for AUD/JPY appears slightly positive as the price remains above the 100-day exponential moving average around 106.90 and continues to adhere to a larger uptrend pattern. The RSI has moved back from overbought levels into the high-40s, suggesting a reduction in previous bullish momentum, though it has not yet signaled a clear transition towards a seller’s advantage.
Immediate support is identified at the recent swing area near 110.00, with a more substantial floor at 109.20. The 108.00 zone serves to safeguard the 100-day EMA and maintains the integrity of the broader bullish structure. On the positive side, initial resistance is observed at the recent high around 113.20, with 114.50 as the next level if upward momentum strengthens.