AUD/USD Current Price: 0.6961
- The Reserve Bank of Australia is expected to cut rates to a new record low of 1.0%.
- Chinese soft data and dollar’s demand triggered an AUD/USD decline.
The AUD/USD pair has peaked at 0.7034 at the weekly opening amid the generalized positive sentiment that dominated the financial markets but ended up falling to the current 0.6960 price zone, as Aussie’s strength was offset by poor Chinese data released over the weekend, while the greenback appreciated on positive US macroeconomic figures. Early Monday, Australia released the TD Securities Inflation monthly report, which resulted at 0.0% in June, while China released the Caixin Manufacturing PMI which fell more than anticipated, down to 49.4 from 50.2 in May, also below the 50.0 expected.
The Reserve Bank of Australia will have a monetary policy meeting early Tuesday, and the market is anticipating another rate cut coming, to a record low of 1.0%, most of it, already priced in. Nevertheless, the decision to take the cash rate lower would likely hit the Aussie, alongside a dovish outlook from Lowe & Co. The fact that the US Federal Reserve has also shifted to a cut policy offsets RBA’s efforts, and shouldn’t surprise if Australian policymakers have more cuts in their sleeves.
The AUD/USD pair is trading at around the 38.2% retracement of the latest bullish run, measures between 0.6831 and the mentioned high. The short-term picture is bearish, as, in the 4 hours chart, is currently developing below its 20 SMA, which gains bearish strength in the 0.6990 area, and as the 100 and 200 SMA lack directional strength below the current level. Technical indicators have pared their declines but remain near their daily lows, rather reflecting the decreased volume at the end of the day than indicating downward exhaustion.
Support levels: 0.6930 0.6895 0.6860
Resistance levels: 0.6990 0.7035 0.7070
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD holds above 1.0750 to start the week
EUR/USD trades in positive territory above 1.0750 in the European session on Monday. The US Dollar struggles to find demand following Friday's disappointing labor market data and helps the pair hold its ground.
GBP/USD clings to small gains above 1.2550
Following Friday's volatile action, GBP/USD edges highs and trades in the green above 1.2550. Soft April jobs report from the US and the modest improvement seen in risk mood make it difficult for the US Dollar to gather strength.
Gold price rebounds on downbeat NFP data, eyes on Fedspeak
Gold price (XAU/USD) snaps the two-day losing streak during the European session on Monday. The weaker-than-expected US employment reports have boosted the odds of a September rate cut from the US Fed.
Addressing the crypto investor dilemma: To invest or not? Premium
Bitcoin price trades around $63,000 with no directional bias. The consolidation has pushed crypto investors into a state of uncertainty. Investors can expect a bullish directional bias above $70,000 and a bearish one below $50,000.
Week ahead: BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.