AUD/JPY drops to a low of 70.15 still up of 0.17% on a day, after RBA released minutes of its May month monetary policy on early Tuesday but later on stepped back on the Aussie-China tension.

Before the latest Aussie-China war, markets were happy cheering the hopes of the corona virus (COVID-19) cure. The relationship between Australia and China is at a low point following the threat to boycott Tourism and exports and proposed an inquiry in the origin of corona virus. Liberal-National coalition pushed for a transparent investigation of the spread of the virus.

On Tuesday early warning in Asia, China’s Ministry of Commerce confirmed 80% tariffs on Australian barley for five years on anti-dumping grounds which added to the down for the pair which seems to be a response for the Aussie PM Scott Morrison’s push for the investigation.

The payroll jobs fell to 7.3%. The latest data shows a further slowing in the fall in COVID-19 job losses between mid-April and early May. Some industries were now showing a reduced impact in the most recent weeks.

Considering all the factors we expect a bullish trend for the pair. If there bull continues then it can break at 69.60 (R1) resistance line and aim for the 70.11 (R2) resistance level. If the bears take over, we could see the pair breaking the prementioned upward trendline, the 68.73 (S1) support line and aim for the 68.38(S2) supportlevel.

AUD/JPY 4 Hour Chart:

Support: 68.73 (S1), 68.38 (S2), 67.51 (S3).

Resistance:  69.60 (R1), 70.11 (R2), 70.98 (R3).

The release of RBA minutes favors the pair and sets a bullish trend.