Australian Dollar continues to trade as the second worst performing one, just next to New Zealand Dollar, this week. New South Wales just reported record 681 daily new delta cases and another death, while regional lockdown has been extended until August 28, in line with Greater Sydney. Victoria reported 57 new cases as Melbourne is in tough restrictions until at least September 2. Overall, weaker risk-sentiment is also weighing on Aussie, after DOW’s -1% fall overnight.
AUD/JPY is one of the biggest movers this week, and is on track to continue with the decline from 85.78. Such fall is seen as a correction to the up trend from 59.89 for the moment. Next target is 78.44 resistance support, and then 38.2% retracement of 59.89 to 85.78 at 75.89. We’d tentatively look for some support from there to bring rebound. But in any case, break of 81.56 resistance is needed to indicate completion of the decline. Or, near term outlook will stay bearish in case of recovery.
