AUD/USD dipped on the CPI data yesterday as the market has started to price in a rate cut by the RBA at the next meeting in early August. However, the dip to 1.0170 was short lived as the early Europe saw a climb on the reports in the WSJ that more QE was coming. European stories about possible changes at the ECB also favoured risk sentiment with short term bears being squeezed above 1.0250 and 1.0285 stops. Offers above 1.0310 capped the rise in the early US morning after fears of a slowing Apple stock looked to dampen growth expectations. Bears tried to jump on the return to 1.0260 but the overall better risk appetite drove the price into the mid to 1.03’s. Rising equity markets in the afternoon helped the price close still in the 1.03’s. A lack of local data could see the AUD return to the 1.0335 highs before topping. Talk of range traders looking for the climb to sell into will be increasing after getting chopped out on yesterday’s rise through 1.0250/85.
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