Where Next For AUDJPY And What Will That Tell Us About Risk Appetite?

Whilst the daily chart of this forex cross is quite noisy at the moment, the weekly chart shows we are at an extremely important level that could give us insight in to the future direction of AUDUSD (which I discussed here) as well as risk appetite in general.

This cross typically moves higher in times where market participants are happy to accumulate risk assets, driving markets higher. The opposite is typically true of risk-off periods. Given this cross is now trading on major uptrend support drawn off the '08 and '16 lows, I would suggest watching this one closely. A clean break below support could both offer trading opportunities on the short side, as well as providing information as to the future direction of asset prices, including equity markets.

It would take a move through ~84.50 before I could become bullish on this one. Should it get there and push on higher, I suspect that would be accompanied by a stronger global asset price environment.