AUD/JPY spikes, jumps above 77.00 handle

The regional risk barometer AUD/JPY rebounded from the weekly pivot support of 76.25 levels to trade above 77.00 handle, thus suggesting risk assets may have a good time during the day ahead.

Deutsche Bank could still rock the boat

The uptick in the AUD/JPY is a welcome move; however, the rebound could be short lived as Deutsche Bank is far from being out of the troubled waters. There is increasing probability that the bank may have to resort to depositor bail-in, given that Chancellor Merkel has ruled out the state aid.

Moreover, the latest rally could be blamed on the sharp rebound in the USD/JPY from near 100.00 levels. The cross was last seen trading just above 77.00 levels.

AUD/JPY Technical Levels

The immediate resistance is seen at 77.31 (weekly 5-MA) above which the cross could target 77.61 (weekly pivot resistance) and 78.00 (zero figure) levels. On the other hand, a breakdown of support at 76.89 (weekly pivot) would open doors for a re-test of 76.45 (previous day’s low). Next major support is seen at 76.00 (zero figure) levels.