• The AUD/JPY pair stands at 97.409 showing 0.50% gains in the last session of the week.
• The main reasons for the upward movements are the divergent RBA and BoJ monetary policy, which benefit the Aussie.
• Daily Chart indicators show strong buying momentum while four-hour indicators flash overbought conditions.
• Despite the looming correction, the overall trend is bullish.

In Friday's session, the AUD/JPY was observed rising to 97.40, registering a t gain of 0.50. This performance is primarily shaped by the contrasting economic stances of the Reserve Bank of Australia (RBA) and the Bank of Japan (BOJ). With the daily chart indicating a bullish momentum and the bulls asserting their dominance, the prevailing outlook seems positive. However, the four-hour chart shows indicators have entered the overbought zone, suggesting a potential for imminent correction.

In line with that, recent statements by the RBA Governor Bullock suggest a balanced perspective with the potential for future interest rate changes. The possibility remains open for both an increase or a standstill, subject to inflation and economic growth. The market expects the RBA's first rate cut in August, with a total easing of 50 bp anticipated for the year. In contrast, the Bank of Japan BoJ maintains a dovish stance, with Governor Ueda affirming that accommodative financial conditions may continue after the current negative rates era. As per the latest data, the likelihood of rate liftoff from the BoJ is forecasted for June, with only 25 bps of tightening for the rest of 2024, and as long as markets bet on a dovish BoJ, the pair may see further upside