AUD/JPY Price Analysis: Prods 89.75-85 hurdle amid strong Aussie trade numbers, downbeat China PMI

• AUD/JPY recovers from weekly low, pares intraday losses during three-day downtrend.
• 50% Fibonacci retracement level, nearly oversold RSI challenges further downside.
• Australia trade numbers for March came in firmer, China Caixin Manufacturing PMI for April disappoints.
• Convergence of 50-SMA, 100-SMA and one-week-old previous support line guards immediate upside.

AUD/JPY picks up bids to pare intraday gains around the weekly low as traders cheer strong Aussie foreign trade numbers while paying little heed to China activity data on early Thursday. In doing so, the cross-currency pair prints mild losses near 89.80 during a three-day losing streak.

That said, China’s Caixin Manufacturing PMI for April drops to 49.5 versus 50.3 expected and 50.0 prior. Earlier in the week, the NBS Manufacturing PMI for the dragon nation offered a negative surprise before the Chinese markets went on a long holiday until Thursday.

On the other hand, Australia’s headline Trade Balance rose to 15,269M in April versus 12,650M market forecast and 13,870 prior. Further, Exports and Imports also improved to 4.0% and 2.0% versus -3.0% and -9.0% respective priors.

As a result, the Aussie data helps the AUD/JPY price to rebound from a 50% Fibonacci retracement of the pair’s run-up from late March to early May, backed by nearly oversold RSI (14).

However, downbeat China PMI data and convergence of the 100-SMA and 50-SMA join the bearish MACD signals to challenge the pair buyers near 89.75-85 resistance confluence.

Even if the quote rises past 89.85 hurdle, the 90.00 round figure and April 20 swing high of near 90.80 can restrict the AUD/JPY pair’s further advances.

Meanwhile, 50% and 61.8% Fibonacci retracements can limit the short-term downside of the AUD/JPY pair near 89.30 and 88.50 levels in that order.

Following that, an upward-sloping support line from early April, near the 88.00 threshold, will be crucial to watch for the pair sellers.

AUD/JPY: Four-hour chart

Trend: Pullback expected