Flash: USD/JPY base building as AUD/USD sees post FOMC downside risks - OCBC Bank

FXstreet.com (London) - Emmanuel Ng of OCBC Bank suspects that USD/JPY will continue to base build post FOMC, while AUD/USD downside risks may have become entrenched.

He begins with USD/JPY, commenting that the pair may continue to base build after the FOMC with now a classic story of contrasts (i.e., Fed vs. BOJ) at play. He writes, “Near term resistance for the pair is expected going into the 100-day MA (96.85) and then the 98.00 neighborhood. A potential impediment to any USD-JPY ascent however may stem from Nikkei weakness and/or the heavy JPY crosses if global appetite sours again.” Moving to AUD/USD, he feels that post Bernanke, the downside risks for the AUD may have become more entrenched in the near term, especially with the latest RBA meeting minutes essentially on the opposite end of the spectrum relative to the Fed statement and Bernanke’s comments. He writes, “We look for the pair to seek comfort towards the 0.9200 floor in the interim.”