FxWirePro: AUD/JPY pares early losses, finds strong support at daily cloud

AUD/JPY chart - Trading View

AUD/JPY has erased early losses and edged higher from session lows at 75.69. 

The pair extended weakness in early Asian trade after disappointing Aussie data and resurgence of coronavirus cases dented risk appetite.

Australia's Wage Price Index rose 0.1% quarter-on-quarter in the third quarter, missing the forecast for a steady 0.2% growth. 

In annualized terms Wage Price Index rose 1.4% , marking a slowdown from the preceding quarter's 1.8% rise and narrowly missing the forecast for 1.5%. 

The weaker-than-expected release validated the Reserve Bank of Australia's (RBA) dovish stance weighing on the AUD. 

That said, vaccine optimism grows as Sinovac Biotech announced positive news on its experimental COVID-19 vaccine, CoronaVac.

According to the preliminary trial results released on Wednesday, Sinovac's covid vaccine triggers quick immune response.

The latest announcement follows American pharma giants Pfizer and Moderna's announcement that their covid vaccine has over 90% effective based on interim data.

AUD/JPY trades with a positive bias. Downside finds strong support at daily cloud. Break below will drag prices lower.

Next major bear target lies at 23.6% Fib at 74.07. Failure to break below cloud will see upside resumption.