Australia – Home Loans
On Monday, at GMT 12:30 a.m., the Australian Bureau of Statistics released the month-over-month home loans figure, which measures the changes in the number of new loans approved for owner-occupied homes.
Since most home purchases are financed by banks, the new home loan figure acts as an excellent gauge of how many qualified buyers are ready to take out home loans. Therefore, economists and binary options traders consider the changes in the new home loan figure to be a leading indicator of the overall economic situation in the country.
Last month, the Australian new home loans increased by 0.2% and the forecast for this month was set at an increase of 1.8%. However, the actual new home loans figure suggested that it has gone down by 0.7%.
Japan – Current Account
Yesterday night, the Japanese Ministry of Finance released the national current account figure, which measures the difference in value between imported and exported goods, services, income flows, and unilateral transfers happened over the last month.
Although the national trade balance figure includes the goods, the current balance offers a more comprehensive account of the national currency demand as it includes services and income flows, as well as unilateral transfers. Hence, economists and market participants consider the current account figure to another important leading indicator of a nation’s currency demand, besides trade balance.
During December, the Japanese current account figure 0.95 trillion and the forecast for January was set at 0.69 trillion. The actual current account number, however, came out near to last month at 0.91 trillion.
Trade Recommendation for the AUD/JPY
Since the AUD/JPY price broke below the sharp uptrend line on November 24, it has been trending downwards. In the process, the AUD/JPY has broken below the significant support level around 100 and 98.70.
Although the AUD/JPY price closed below the next support level, 96.00, on December 16, the price action failed to carry through. Since then, the AUD/JPY price has been trading within the narrow range between 98.25 and 96.
As the Australian new home loans slowed down and the Japanese current account balance came out better than what the market was expecting, fundamentally, the AUD/JPY is set for another rebound from the 96.00 level.
Earlier today, the AUD/JPY did go on to touch the 96.00 once again but since then, it has retraced to 96.95. Under the circumstances, it suggests that binary options traders place a CALL with an exit target around 98.25.
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