AUD/JPY nears the July highs
AUD/JPY touched the highest since July 26 yesterday and is holding near the high.
This pair was battled from December 2018 through August and -- no coincidence -- that was the time when the trade war was constantly worsening.
The the past two months, the tone on trade and global growth has tentatively shifted. As a result, AUD/JPY has climbed nearly 8% from the lows. The bulk of the gains have come in a rally to 75.00 from 72.00 in the past month.
Importantly, the gains Tuesday pushed the pair to a marginal new 3-month high. The looming challenge for the pair is the clump of resistance of the July high and the 200-day moving average.
There is a nice synchronicity between a challenge of those key levels and a US-China trade deal. If we get a deal with a smiling photo of Trump and Xi along with real prospects for a year-long ceasefire then look for those to break in a rally to 78.00, or even 80.00.
