AUD/USD rallies 30+ pips following no change in RBA Interest Rate


  • AUD/USD extends recovery from multi-month lows.
  • Global equities, bonds portray risk reset despite spreading coronavirus contagion.
  • Second-tier data from the US can offer intermediate moves, risk catalysts to direct broad moves.

AUD/USD takes the bids to 0.6711 after the RBA leaves its benchmark interest rates unchanged during early Tuesday. The pair previously dropped amid fears of coronavirus outbreak.

RBA matches wide expectations…

The Reserve Bank of Australia (RBA) matched the most consensus while keeping the benchmark interest rate at 0.75%. In doing so, the RBA leaves the door open for further monetary policy actions, if needed.

Read: Breaking: AUD/USD tests 0.6700 after RBA leaves rate unchanged at 0.75%

The Aussie central bank considered Bushfires, coronavirus as temporary burdens on the economy while also saying that it's too early to determine how long-lasting the impact from coronavirus will be.

Read: RBA: Bushfires, coronavirus will temporarily weigh on growth

Risk reset under process…

Although increasing numbers of coronavirus victims have been a cause of concern, the Chinese press follows the World Health Organization’s (WHO) footsteps to placate traders. Also, earlier comments from Chinese President Xi Jinping and the active performance of diplomats in Beijing, to tame the short-selling on the first day of trading, might also have contributed to risk reset.

While portraying the same, the Asian equities have started posting gains while the US 10-year treasury yields and S&P 500 Futures also flash green signals by the press time.

Even so, statements from China are raising concerns over the phase-two trade talks between the US and Beijing. The world’s top two economies might have to meet and discuss possible alterations to their phase-one deal as the current coronavirus affects China’s performance on terms.

Having learned the RBA’s interest rate decision, markets will now keep eyes on Friday’s RBA monetary policy statement and Governor Philip Lowe’s speech for further details. In the meantime, second-tier economics from the US, relating to employment and PMIs, could entertain traders. It should also be noted that any updates concerning China’s coronavirus will be taken seriously for fresh direction.

Technical Analysis

October 2019 bottom around 0.6670 holds the keys to pair’s further downside towards 0.6635 and then to 0.6600 round-figure. On the flip side, November month low near 0.6755 can keep the short-term pullbacks limited.

Additional important levels

Overview
Today last price 0.6686
Today Daily Change -0.0002
Today Daily Change % -0.03
Today daily open 0.6688
 
Trends
Daily SMA20 0.6829
Daily SMA50 0.6863
Daily SMA100 0.6836
Daily SMA200 0.6869
 
Levels
Previous Daily High 0.6708
Previous Daily Low 0.6683
Previous Weekly High 0.6829
Previous Weekly Low 0.6682
Previous Monthly High 0.704
Previous Monthly Low 0.6682
Daily Fibonacci 38.2% 0.6693
Daily Fibonacci 61.8% 0.6698
Daily Pivot Point S1 0.6678
Daily Pivot Point S2 0.6668
Daily Pivot Point S3 0.6653
Daily Pivot Point R1 0.6703
Daily Pivot Point R2 0.6718
Daily Pivot Point R3 0.6728

 

 

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