AUD/USD analysis: RBA meeting up next, credit conditions and labor market taking center stage
|AUD/USD Current price: 0.7209
- AUD/USD holding steady at 0.7200, the 61.8% retracement of its September/October decline.
- RBA expected to maintain rates on hold at record lows of 1.5%. No changes expected until 2020.
The AUD/USD pair spent the day around 0.7200, unable to advance beyond the level but with the downside well-limited by absent dollar's demand. Australian data released at the beginning of the day was quite disappointing, as the AIG Performance of Services Index for October resulted at 51.5 from the previous 52.5, while the TD Securities Inflation estimated a 0.1% increase MoM and a 1.9% YoY, below September 0.3% and 2.1% respectively. Also, Asian stocks' markets were down, while European indexes closed little changed around their opening levels. Wall Street's performance was mixed, with a lagging tech-sector driving the Nasdaq Composite sharply lower.
The Reserve Bank of Australia will have its monetary policy meeting this Tuesday, and policymakers are expected to leave rates steady at a record low of 1.5%. Attention will shift to credit conditions and the labor market, as policymakers have expressed concerns about tighter credit conditions in their previous meeting but they are confident about the situation around jobs. Reviews to growth and inflation forecasts could trigger some interesting moves in AUD crosses after the release.
The pair spent the day hovering around the 61.8% retracement of its September/October decline, meeting sellers in the 0.7180 region, but unable to advance beyond 0.7215. The 4 hours chart shows that the 20 SMA has extended its advance, now maintaining its bullish slope above the larger ones, which leans the risk toward the upside. The lack of progress results in the Momentum indicator retreating toward its mid-line, but the RSI indicator retains a mild bullish slope, currently at 64, this last, also backing the bullish case.
Support levels: 0.7165 0.7120 0.7080
Resistance levels: 0.7215 0.7250 0.7290
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.