AUD/JPY Price Forecast – AUD/JPY Tests Support as Risk Appetite Returns on Hormuz Rumors

From Daily Forex, this is Chris from Lewis taking a look at the Australian dollar against the Japanese yen. The Australian dollar initially pulled back against the Japanese yen during the trading session here on Thursday, but turned around and showed signs of life and now we're starting to see rumors that the United States and the Iranians may be working on reopening the Strait of Hormuz. So it's possible maybe we're seeing a little bit more risk appetite coming back into the market. You certainly are seeing that in the stock markets suddenly. So we'll have to wait and see. Now keep in mind we've heard stories like this in the past and they generally end up disappointing. So that is something to be cognizant of, but when you look at this market >> [clears throat] >> the interest rate differential stands out quite drastically anyway. So I don't necessarily think it's a bad idea to own the Australian dollar. The Japanese recently had an interest rate hike, but they also uh had two members dissent and not want to raise rates. So there are questions to be asked about how this plays out over the longer term. I do believe at this juncture though we have to look at this through the prism of a market that is trying to do what it can to get back to essentially fair value. The market is in a 500 point range in general and I do believe that is one of the defining traits of this market and as this market continues to see a lot of noise attached to it via the carry trade despite the fact that there had been multiple interventions, this is a market that still remains somewhat stable, and that is something worth paying attention to. Beyond that, the 200-day EMA sits just above the 110 yen level, and this is a market that so far looks like it does not want to break down below it.