AUD/USD remains bid as RBA statement carries hawkish tinge

RBA keeps rates unchanged as expected.
AUD could extend gains as the RBA statement carries hawkish tinge.

Omkar Godbole FXStreet Contributor

The Reserve Bank of Australia kept the cash rate (interest rate) unchanged as expected but sounded a little bit hawkish on inflation.

The central bank has omitted the line - "inflation is likely to remain low for some time". Further, it says the Australian dollar remains within a range of the past two years. Both the statements could be read as being hawkish and may strengthen the bid tone around the AUD.

As of writing, the AUD/USD pair is trading at 0.7640 levels. The currency pair found bids below 0.76 in early Asia, tracking the late NY session decline in the treasury yields. Also, a better-than-expected Aussie retail sales data and China services PMI release boosted the demand for the AUD.

AUD/USD Technical Levels

AUD/USD seems to have found a near-term bottom at 0.7532, courtesy of the bullish price-RSI divergence on the dailies and a breach of the descending top pattern. A move above 0.7645 (Nov. 27 high) would open up upside towards 0.7691 (200-day MA) - 0.7707 (50-day MA). Further gains could be hard to come as the 50-day MA is fast approaching the 200-day MA for the negative crossover.

On the downside, breach of support at 0.76 (psychological level) could yield a pullback to 0.7551 (Dec. 1 low). A violation there would expose the recent low of 0.7532.

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Bullish	Neutral	Expanding
1H	Bearish	Overbought	Expanding
4H	Bullish	Neutral	Expanding
1D	Bullish	Neutral	Low
1W	Bullish	Oversold	Shrinking
Updated Dec 5, 03:45 GMT

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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