• AUD/ JPY gained strength on Thursday as more news of China stimulus boosted risk sensitive Australian dollar.
• In a bid to stimulate domestic demand, China unveiled plans to distribute one-time financial assistance to vulnerable groups, coinciding with a broader stimulus package.
• Meanwhile, the Reserve Bank of Australia, which has ruled out a rate cut for this year, cautioned households on Thursday about the risks of taking on excessive debt as interest rates begin to decline.
• By 05:42 GMT, Australian dollar was up 0.60% against the yen to 99.37. It dropped as low as 98.62 on Wednesday.
•The technical outlook remains bullish and points to eventual bigger gains, Fourteen-day momentum is positive, reinforcing the scope for a bigger gains
• Immediate resistance is located at 99.40 ( Sep 25th high), any close above will push the pair towards 100.00 (Psychological level).
• Immediate support is seen at 98.64 (38.2% fib) and break below could take the pair towards 97.59 (50% fib).
Recommendation: Good to buy around 99.30, with stop loss of 98.50 and target price of 100.00
