Forex: AUD/JPY jumps to 7-mth highs; resistance at 84.70

FXstreet.com (San Francisco) - The Australian dollar opened at a 7-month high against its Japanese counterpart this Monday in Asia, starting the week at 84.20 (vs. 84.02 Friday), a price not seen since April 27.

The move comes on JPY weakness, due to expectations of aggressive monetary easing from the Bank of Japan, and to AUD strength (risk tolerant) as players remain confident that U.S. politicians can avoid tumbling off of the 'fiscal cliff'.

Technically speaking, AUDJPY has jumped to levels above the 84.10 resistance zone (Nov 7 high) having so far traded as high as 84.30, with immediate resistance seen in the 84.70-80 price zone (Feb 22-Mar 7 lows). Further resistance is noted at 85.10 (Mar 23 low) and 85.55 (78.6%, 88.57/74.44 sell-off). Support levels are noted at 83.55 (Aug 21 high), 83.15 (61.8%) and 82.85 (Jan 26 high).

"AUDJPY will be the pair to watch today, and if USDJPY breaks higher then look for the AUDUSD to follow suit in the short term," comments Sean Lee, founder of FXWW. AUDJPY holds firm in the 84.25 area, at the time of writing; AUDUSD holds onto its upside gap advantage, still around 1.0350; USDJPY is trading at its 7-month highs, last quoted at 81.40, and still remains below a 61.8% Fibonacci retracement level at 81.50 (80.57/77.12 decline).