FxWirePro: AUD/JPY consolidates previous session's slump, on track to test 200-DMA

AUD/JPY chart - Trading View 

AUD/JPY was trading 0.40% higher on the day at 73.74 at around 05:00 GMT, after closing 1.31% lower in the previous session.

The pair is extending marginal gains as the yen remains offered across the board after BoJ held rates and lowered Japan's growth forecasts at its policy meet earlier today.

As widely expected, BoJ kept monetary policy steady, while trimming its economic and price forecasts for the current fiscal year, heightening expectations it will maintain its massive stimulus.

The BoJ said it expects the economy to fall 5.5% in the current fiscal year ending March 2021. It expects core consumer prices to fall 0.6%.

The Australian dollar on the other side ignored an above-forecast drop in Q3 imported inflation and remained bid as it tracked gains in S&P 500 futures.

That said, the Reserve Bank of Australia is set to provide additional stimulus next month, to support economic recovery. 

Technical bias for the pair remains bearish. AUD/JPY is on track to test 200-DMA at 72.79. Violation there will see test of 38.2% Fib at 71.35.

5-DMA is immediate resistance at 74.19. Break above will see minor upside. bearish invalidation only above daily cloud.