AUD/JPY getting destroyed, en-route to 80.00

By FXStreet AUD/JPY has accelerated to the downside after falling over 150 pips in the last 3 hours of trading, currently exchanging hands at 80.35 multi-week lows from a NY close at 82.05, with the Nikkei 225 down over 5%.

A sea of red in Asia

The risk aversion conditions seen on Monday have worsened significantly in Asian trade today, with the Nikkei 225 being annihilated by more than 5%, as mentioned, the SP500 futures are down -0.86%, US 30-year bonds have caught a very strong bid, last at 166.31, while the Australian ASX stock index falls by 2.5%.

Yen jawboning? Does it matter?

While there continues to exist risk of BOJ jawboning the Japanese Yen, given the recent disruptive moves in the currency (USD/JPY is down more than 600 pips from the BOJ-led spike high after adopting negative rates), it is unlikely that any intervention will have long-lasting effects to depreciate the currency as conditions stand. If the BOJ has learnt a lesson since the GFC, is that fighting the Yen bull trend in times of strong ‘risk off’ is only delaying the inevitable resumption of that trend.

AUD/JPY key levels

On the downside, the next key level to pay attention to is 80.30 (lowest of …read more

Source:: FX Street