AUD/JPY slips to four-month lows on Trump's renewed China trade threat
5/6/2019 1:02:36 AM
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Trump's renewed China trade threat and the resulting flight to safety has strengthened the bid tone around the anti-risk JPY. The AUD/JPY pair is curr

  • AUD/JPY is feeling the pull of gravity amid renewed US-China trade war fears.
  • The cross is currently trading at the lowest level since Jan. 4.
  • Risk-off has put a bid under the JPY.
  • AUD/JPY is feeling the pull of gravity amid renewed US-China trade war fears.
  • AUD/JPY is feeling the pull of gravity amid renewed US-China trade war fears.
  • The cross is currently trading at the lowest level since Jan. 4.
  • The cross is currently trading at the lowest level since Jan. 4.
  • Risk-off has put a bid under the JPY.
  • Risk-off has put a bid under the JPY.

    Trump's renewed China trade threat and the resulting flight to safety has strengthened the bid tone around the anti-risk JPY.

    The AUD/JPY pair is currently trading at 76.95, the lowest level since Jan. 4. The currency pair gapped lower at 77.08 and revisited the former support-turned-resistance of 77.50, as predicted by FXStreet's Ross Burland, before falling to four-month lows. 

    as predicted

    President Trump tweeted Sunday that tariffs on $200 billion worth of Chinese goods will increase to 25% on Friday from the current 10%, pouring cold water over the optimism generated by repeated claims by both Washington and Beijing that trade negotiations are going well.

    Further, Trump threatened to impose 25% tariffs on an additional $325 billion of Chinese goods “shortly”. The President added that trade talks with China are continuing, but are moving too slowly.

    The renewed fears of a full-blown trade war have sent risky assets lower in Asia. For instance, the futures on the Dow Jones Industrial Average are currently down 400 points, while those on the S&P 500 are down 50 points. Both oil benchmarks – WTI and Brent – are also reporting a 2% drop.

    oil

    As a result, the classic safe havens like JPY and Gold are flashing green. The Japanese Yen has gained 0.4% against most majors and gold is mildly bid with 0.25% gains.

    gold

    Looking forward, the AUD/JPY cross may suffer deeper losses if China's Caixin Services PMI (Apr), due at 01:45 GMT, prints below estimates. Further, the news is crossing the wires that China's Vice Premier Liu He has canceled a trip to Washington. That would only boost trade war fears and strengthen the bid tone around the safe havens.

    newshas canceled

    Pivot points

    Pivot points
      1. R3 78.56
      2. R2 78.38
      3. R1 78.2
    1. PP 78.02
      1. S1 77.84
      2. S2 77.66
      3. S3 77.48
      1. R3 78.56
      2. R2 78.38
      3. R1 78.2
    1. PP 78.02
      1. S1 77.84
      2. S2 77.66
      3. S3 77.48
      1. R3 78.56
      2. R2 78.38
      3. R1 78.2
    1. PP 78.02
      1. S1 77.84
      2. S2 77.66
      3. S3 77.48
      1. R3 78.56
      2. R2 78.38
      3. R1 78.2
    1. PP 78.02
      1. S1 77.84
      2. S2 77.66
      3. S3 77.48
    1. R3 78.56
    2. R2 78.38
    3. R1 78.2
    1. R3 78.56
    2. R2 78.38
    3. R1 78.2
  • R3 78.56
  • R3 R378.56
  • R2 78.38
  • R2 R278.38
  • R1 78.2
  • R1 R178.2
  • PP 78.02
  • PP PP78.02
    1. S1 77.84
    2. S2 77.66
    3. S3 77.48
    1. S1 77.84
    2. S2 77.66
    3. S3 77.48
  • S1 77.84
  • S1 S177.84
  • S2 77.66
  • S2 S277.66
  • S3 77.48
  • S3 S377.48