AUDUSD sunk even further today after RBA Governor Stevens talked down the Aussie. The Governor stated that the value of the Australian dollar isn’t justified by its fundamentals and he expects it correct lower. AUDUSD sold off hard on the back of his comments, before widespread USD strength hit the market and caused the pair to sink even further. The PBoC’s first reverse repo operation in two weeks helped to push yields down in China’s money markets and steam the sell-off in the Aussie, but it wasn’t enough to stop AUDUSD from reaching a support zone just above 0.9500.
AUDUSD is testing its 21day SMA, which has been a key level of support for the pair recently. The market is awaiting a policy meeting at the FOMC which has the ability to significantly impact the majors. Also, there is a slew of data out of the US this week, including retail sales, inflation, ADP non-farm employment, unemployment claims and ISM manufacturing data, all of which are potentially market moving data releases. With the market so focused on the US, Thursday’s building approvals data out of Australia may take a backseat.
Support
- 0.9485 – channel support
- 0.9325 – prior support and pivot zone
- 0.9260 – 100day SMA
Source: FOREX.com
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