AUD/JPY mounts the 82.00 handle as market confidence returns, for now

• Aussie climbs for the second day in a row against the Yen, squeezing at the top to make it a third.
• Australian Home Loans figures at 01:30 GMT.

The Aussie bounded higher against the Yen in Thursday's trading, climbing above the82.00 handle and currently testing around 82.40 heading through the overnight session.

Markets have more or less stabilized from recent routs in sentiment from trade tensions between the US and China, and ongoing tensions between the US and Iran. The US has formally pulled out of the Iran accord, and the ever-present risk of a full-on trade war with China will continue to haunt markets in the coming months, but markets have managed to recover somewhat and risk assets are taking steps upwards against safe haven counterparts.

The AUD sees Home Loans numbers at 01:30 GMT today, expected at -1.9% versus the previous -0.2%, a notable decline in the figure, while Japan has no significant data this week. A beat for Home Loans could send the Aussie higher for a third day in a row, but with the Australian economy disappointing more often than not, a miss for the figure could just as easily give the AUD/JPY pair a corrective stance.

AUD/JPY levels to watch

Despite a still-bearish long-term technical outlook, the pair has managed to stage a brief recovery, and Wednesday's correction prices in a near low for the pair at 81.13, while a bullish continuation will quickly run into resistance at the 50.0 Fibo level near 82.50 and the 50-day EMA at 82.80, while a bearish continuation will have to contend with April's low near 80.80 to get the long-term bearish trend restarted.