NAB Research discusses AUD/JPY outlook and thinks that short AUD/JPY is an attractive play to position for the recent risk-off theme.
"AUD/JPY in our view it is the G10 “weapon of choice” to express the current risk aversion theme.
The pair is currently toying with a break sub ¥81 and a move sub the ¥80 key psychological level brings the Sep16 low of ¥ 75.9 well within sight.
We retain a bearish outlook on the AUD and bullish one on JPY. Even if key weekly support levels are not broken today, we think it is reasonable to expect both USD/JPY and AUD/JPY to trade lower over the coming months," NAB argues.