The AUD/JPY pair sees bids rise to re-establish a weekly high.
JPY is being weighed down by higher Treasury yields and optimistic equities.
The highest covid count in ten months was recorded in Australia, and the Tokyo emergency was extended on Monday.
The importance of China trade statistics, BOJ, and coronavirus updates becomes critical.
AUD/JPY jumps to a new intraday high of 82.65 during Tuesday’s Asian session, up 0.16 percent on the day. Despite the imminent coronavirus (COVID-19) concerns in Australia and Japan, the pair extends Friday’s bounce from a five-month low for the third day in a row.
Following the largest virus infections since September, Australian policymakers tighten activity restrictions in crucial locations, such as New South Wales, while also indicating that lockdowns will be extended for a few weeks. On the other side, Japanese officials have already extended the Tokyo emergency and are prepared to provide free vaccine passports, not to mention hold no-spectator Olympics, in order to deflect criticism of holding a sporting event in the midst of a pandemic.
Alternatively, UK diplomats continue to work on a July 19 unlock date, while US health officials reject the necessity for Pfizer booster shots for fully vaccinated Americans.
In a same vein, market sentiment has remained relatively cheerful as economic reopening revealed positive results in Q2, which could keep central banks from tapering and raising rates, at least for the time being.
Stock futures are swaying near the record high, while shares in Australia and Japan have gained 0.50 percent and 0.78 percent, respectively, as of press time. The 10-year Treasury yields in the United States have remained firmer for the third day in a row.
Moving on, the conflicting headlines and China’s June trade data may entice intraday traders. However, the Bank of Japan’s (BOJ) monetary policy meeting this week will be closely watched, as officials may reduce economic predictions in the wake of the virus’s reappearance, putting pressure on the Japanese currency (JPY).
The AUD/JPY pair extends its rally from the 200-day EMA to a two-week-old resistance line near 82.95, but bearish MACD keeps sellers hoping for a retest of the 81.40 crucial EMA support./n
