AUD/USD analysis: Aussie weak heading into the RBA meeting

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7387

RBA expected to maintain the status quo, keep the focus on the housing sector and trade war risks.
AUD/USD neutral-to-bearish but within familiar levels, bears looking for a break below 0.7330.

The Aussie fell just modestly against its American rival, undermined by the soft tone of base metals and equities during the first half of the day. Australia released at the beginning of the day the July TD Securities inflation figures with the CPI estimated up 0.1% MoM and steady at 2.0% YoY. The AUD/USD pair settled some 20 pips below Friday's close ahead of the RBA monetary policy meeting. The central bank is largely expected to introduce no change to its monetary policy, with rates about to turn two years at record lows. The accompanying statement is also expected to offer more of the same, with the focus on the housing sector and concerns about the potential effects of a trade war on the local economy. The wording will be scrutinized for clues on whether policymakers are more confident of more disappointed toward the future, but the RBA doesn't characterize from offering much forward guidance, beyond the usual comment that the next move will rather be up than down. Ahead of the event, the pair offers a neutral stance in its 4 hours chart, as it remained capped by converging 100 and 200 SMA, both running parallel at around 0.7400 and barely above a bearish 20 SMA, while technical indicators head modestly lower around their midlines. The pair remains within familiar levels, and it will take some follow-through either above 0.7445, or below 0.7330 to see a directional continuation afterward.

Support levels: 0.7370 0.7330 0.7300

Resistance levels: 0.7400 0.7445 0.7485

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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