AUD/JPY: how high can this get before risk turns sour again, time to fade?

• AUD/JPY: the market's risk barometer cheering the latest trade war noise.
• AUD/JPY: is up, but for how long until risk flips once again? 

Risk is back on and that means AUD/JPY has taken to the moon and to the highest levels since mid-March, and onto the 83 handle. The catalyst for the turnaround in risk was Xi's comments during an eagerly awaited speech at a development conference on the tropical Chinese island of Hainan called the Boao forum. Currently, AUD/JPY is trading at 83.21, up 1.26% on the day, having posted a daily high at 83.28 and low at 82.07.

Xi billed the planned cut in vehicle tariffs and a series of other measures as "a new phase of opening up," but while the auto pledges are hardly a new thing, but rather a reiteration of the same themes Xi has promoted throughout his tenure, the Chinese President, stating that China should “push for free trade” and that “China will not threaten others, will not undermine existing global order,” and adding that China should “sharply widen access to market” stock markets, which have plunged repeatedly in recent weeks over fears of a potential US-China trade war, responded positively to those comments. Hong Kong's Hang Seng Index and Dow futures were up more than 1% after the speech. 

Risk is on, but for how long?

Today, Wall Street is clinging on to the gains, and some, with the Dow up 2.08%, the S&P 500 +1.77% and the NASDAQ +1.88%. However, it appears that investors are cheering more of what China's Xi did not say on trade, for he offered little in the way of concessions but he didn’t escalate the situation, either where it had been feard he may retaliate in some official way at the event to Trump's proposed ramping up of the tariff war last week. 

Indeed, this is by far from resolved an investor worries will no doubt persist until some sort of detente is reached. AUD/JPY could be subject to a round of profit taking here as it reaches towards the steeply declining 50-D SMA at 83.40 while USD/JPY approaches a hard level of resistance at 107.50. The focus will not turn to 

AUD/JPY levels

AUD/JPY is now up to a 4-hr resistance level at 83.30, a previous low and high in Feb and March. RSI is flattening and momentum is dying out. However, the daily stick's indicators are leaning with a bullish bias still as the price approaches the aforementioned 50-D SMA and channel resistance. 84.30 is the next big level on the upside ahead of 84.50. To the downside, the 21-D SMA is located at 82.02.