AUD/USD: Eyes on September lows of 0.7006 amid dovish RBA
- AUD/USD hit again by dovish RBA minutes, Kent’s comments.
- US dollar bulls holding up as US stimulus hopes wither out.
- Sept lows of 0.7006 in focus, despite higher US futures.
AUD/USD extends its four-day losing streak into Tuesday, looking to threaten the September low of 0.7006 while wallowing in three-week lows near 0.7030.
The expectations of a November rate cut and or bond-buying expansion emboldened after the Reserve Bank of Australia’s (RBA) Deputy Governor Dr. Chris Kent and October meeting minutes suggested that additional easing is due on the cards.
Further pressurizing the downside in the spot, the US dollar holds onto the overnight bounce, as hopes of a potential US fiscal stimulus deal pre-election fade despite the narrowing differences between the House Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin.
Slower-than-expected expansion in the Chinese economy also remains a cause for concern for the AUD bulls. The major remains exposed to further downside risks heading into Tuesday’s US stimulus deadline. The uptick in the S&P 500 futures does little to help the higher-yielding aussie amid the jittery market sentiment.
AUD/USD: Technical outlook
The bears now target the September low of 0.7006, with the next support seen at 0.6985 (daily classic S3). To the upside, 0.7074/80 (pivot point/ 5-DMA) is the level to beat for the bulls in order to regain 0.7100.
AUD/USD: Additional levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
