FxWirePro: AUD/JPY hits fresh 4-week highs at 86.22, China's lending data boosts appetite for commodity currencies

Technical Studies: 

• AUD/JPY set to close higher for the third consecutive week. 
• The pair trades with a bullish bias, remains supported above major trendline support at 85.50.
• Break below 85.50 likely to see test of 85.10 which is 38.2% Fib of 87.29 to 83.74 fall.
• On the upside we see major trendline resistance at 86.23, AUD/JPY has at the time of writing breached 86.23 and is currently trading at 86.26.
• Technical studies support further gains. RSI strong at 64 levels with room to run further. Stochs are at overbought but bias higher.
• MACD line has taken a bullish crossover on signal line. We see scope for upside.

Fundamental Factors:

• China's lending data relased on Thursday showed China new yuan loans spiked unexpectedly in December, despite mounting debt worries.
• Chinese banks extended 1.04 trillion yuan ($A201 billion) in net new yuan loans in Dec, beating analysts' forecasts for a fall to 700 billion yuan.
• For the year 2016, China's banks extended a record 12.56 trillion yuan ($1.82 trillion) of loans.
• In the near term this will continue to boost growth in China and will mean that the appetite for commodities will remain strong, and prices supported.

Support levels -  86, 85.79 (5-DMA), 85.55 (20-DMA), 85.50 (trendline), 85.18 (1H 200-SMA), 84.89 (20-DMA)

Resistance levels -  86.53 (78.6% Fib), 86.59 (Dec 13 high), 87

Recommendation: Good to go long on dips around 85.90, SL: 85.40, TP: 86.25/ 86.50/ 86.90/ 87.15