AUD/JPY slips below 85.00 as RBA frets over weak wage growth

• The AUD is being offered on dovish RBA minutes.
• AUD/JPY - daily RSI oversold, could limit downside.

The AUD/JPY dropped to a session low of 84.78 as the RBA minutes voiced concerns regarding slow wage growth and a strong Aussie dollar.

As of writing, the currency pair is trading at 84.85 levels; down 0.20 percent on the day.

The offered tone around the AUD gathered pace as the RBA minutes took note of the ‘considerable uncertainty’ around wages, talked about competitive pressures weighing on the inflation outlook and warned that a further appreciation of the exchange rate would weigh over economic growth.

Still, the downside in the AUD/JPY pair is being capped at 84.80 levels, possibly due to the oversold nature of the daily RSI. The focus now shifts to RBA governor Lowe's speech. The broader market sentiment and the resulting demand/supply of Yen could influence the AUD/JPY pair as well.

AUD/JPY Technical Levels

A break below the session low of 84.78 would expose support at  84.00 (psychological level), under which the Dec. 2016 low of 83.74 could come into play. On the higher side, breach of resistance at 85.22 (5-day MA) would open up upside towards 85.47 (5-day MA) and 85.98 (200-day MA).