AUD/JPY Price Forecast: Recovers from six-month low, but retains bearish bias below 100-day SMA

The AUD/JPY currency pair traded at around 109.95 during the early European session on Thursday. Japanese manufacturers' confidence rose to an eight-year high in Q3, but non-manufacturers' mood soured, according to the Bank of Japan's Tankan survey. The Tankan Large Manufacturing Index increased to 24 from 22 in Q2, while the Tankan Non-Manufacturing Index declined to 35, below the consensus of 36.

Some BoJ policymakers suggested accelerating interest rate increases or bringing them nearer to the central bank's target, given mounting inflationary pressure. MUFG analysts noted that the Yen derives support from expectations of faster BoJ rate hikes, with market participants anticipating more rate hikes this year. The AUD/JPY pair traded below the 20-day Bollinger Bands simple moving average center, indicating a bearish near-term bias.

Support lay at the 20-day Bollinger Bands lower boundary at 109.30, with further downside risk at the September 30 low of 108.89 and the February 13 low of 107.69. A potential recovery would require breaking the Bollinger center line at 110.90, followed by higher prices above the upper band at 112.50 and the 100-day SMA around 112.65.