The Australian Dollar/Japanese Yen pair, currently trading at 95.2840, is experiencing significant selling pressure due to disappointing consumer inflation data in Australia.

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• AUD/USD meets with heavy supply in reaction to softer Australian consumer inflation figures.

The pair currently trades last at 95.2840.

The previous day high was 95.86 while the previous day low was 95.18. The daily 38.2% Fib levels comes at 95.6, expected to provide resistance. Similarly, the daily 61.8% fib level is at 95.44, expected to provide resistance.

The AUD/JPY cross comes under intense selling pressure during the Asian session on Wednesday and moves further away from a nearly three-week high, around the 95.85 region touched the previous day. The downward trajectory picks up pace following the release of softer-than-expected Australian consumer inflation figures and drags spot prices below the 95.00 psychological mark, or a fresh daily low in the last hour.

The Australian Bureau of Statistics reported that the headline CPI rose 0.8% in the second quarter, missing estimates for a reading of 1% and well below the 1.4% previous. Over the past twelve months to June, the rise in consumer prices slowed to 5.4% from 5.6% in May. Furthermore, the Reserve Bank of Australia’s (RBA) Trimmed Mean CPI slowed to 1% during the April-June period and the yearly rate decelerated from 6.6% to 5.9%, falling short of market expectations. The data pushes back against bets for another RBA rate hike in August and weighs heavily on the Australian Dollar (AUD), which, in turn, is seen as a key factor dragging the AUD/JPY cross sharply lower.

That said, the latest optimism led by expectations for more stimulus measures from China lends some support to the China-proxy Aussie. Meanwhile, growing acceptance that the Bank of Japan (BoJ) will stick to its dovish stance, along with the underlying bullish sentiment around the equity markets, undermines the safe-haven Japanese Yen (JPY). This, in turn, should help limit any meaningful downside for the AUD/JPY cross. Traders might also refrain from placing aggressive bets and prefer to wait on the sidelines ahead of the highly-anticipated two-day BoJ monetary policy meeting starting on Thursday. This, in turn, warrants some caution before positioning for further losses.

Technical Levels: Supports and Resistances

AUDJPY currently trading at 95.6 at the time of writing. Pair opened at 95.7 and is trading with a change of -0.1 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 95.24, 50 SMA 94.28, 100 SMA @ 91.83 and 200 SMA @ 91.93.

The previous day high was 95.86 while the previous day low was 95.18. The daily 38.2% Fib levels comes at 95.6, expected to provide resistance. Similarly, the daily 61.8% fib level is at 95.44, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 95.3, 94.9, 94.62
• Pivot resistance is noted at 95.98, 96.26, 96.66

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