The pair is down by 1.6% on the day
Over the past week, the pair looked to be on course towards testing the 100-day MA (red line) after managing to breach the 61.8 retracement level @ 78.92. However, RBA governor Philip Lowe decided to drop a bombshell on the aussie and we're seeing the currency suffer a beating today against the likes of the dollar and yen in particular.
The yen continues to hold firm as risk sentiment is still searching for direction but the currency got a bit of a boost after a sudden change in the past half-hour as Treasury yields dipped slightly to session lows.
Looking at AUD/JPY from a technical perspective, the bias for the pair now looks to be more bearish as price seeks to hold a break back below the September low @ 78.69. If sellers observe a daily break below that, there isn't much else to stop the pair from falling back towards the 50.0 retracement level @ 77.33 or the late January lows near 77.50 at least (minor support seen around 78.00 though).
As it stands, the only thing that should be able to cause a drastic U-turn in the pair is positive news from trade talks. In essence, that will help provide relief to the RBA and also lift risk sentiment which would be a yen-negative. Otherwise, expect more downside for the pair to come in the next few sessions.
