AUD/JPY Appears Bearish Amid Forecast of Increasing Japanese Household Spending

AUD/JPY – Technical Analysis for Australian Binary Options Brokers

Japan – Household Spending

Tomorrow, at GMT 12:30 a.m., the Japanese Statistics Bureau will release the year over year Household Spending figure, which measures the inflation adjusted value of all expenses by the Japanese consumers.

Binary options investors consider the household consumer spending to be a leading indicator of a country’s economic health. This is because the amounts spent by consumers have a ripple effect on the overall economic activity in the country.

Last month, the year over year Japanese Household Spending figure decreased by -0.4% and the forecast for this month is currently set at an increase of 0.2%.

Australia – Private Sector Credit

On Friday, at GMT 1:30 a.m., the Reserve Bank of Australia will release the month-over-month Private Sector Credit data, which measures the changes in the total value of new credit issued to consumers and corporations in the country over the previous month.

Binary options traders consider the private sector credit to be an important fundamental indicator of the Australian economy as borrowing and spending are highly correlated. Consumers and businesses only take out credit when they feel confident about their ability to pay it back in the future. Hence, it also acts as a measure of consumer and business confidence.

Last month, the private sector credit in Australia increased by 0.5% and the forecast for this month is currently set 0.5% as well.

Trade Recommendation for the AUD/JPY

AUD/JPY Analysis for Australian binary options trading - 26th December

Although the AUD/JPY broke below the uptrend line on December 19, 2016, it produced a large inside bar, which kept the price from falling down over the last week. However, on December 23, the AUD/JPY price broke below the low of this inside bar, indicating a reversal of the uptrend.

As the Australian private sector credit is expected to grow at the same rate as last month, but the Japanese household spending is expected to increase by 0.2%, a massive improvement compared to -0.4% decrease in the previous month, we believe it would contribute to the bearishness of the AUD/JPY price this week.

However, as most major markets around the world would be closed due to holidays this week, it is unlikely that the AUD/JPY price will have any major bearish swing this week. Hence, binary options traders should wait for the next major support level to be broken prior to taking any positions.

Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the AUD/JPY with their Australian binary options brokers as soon as the price closes below the 83.75 level on the daily time frame.

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Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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