RBA minutes preview - what to expect in AUD/USD?

AUD/USD has been better bid on the back of the bullish stock market and a recovery in commodities, but has been able to penetrate 0.7480 or clear much away from 0.7450 and the 38.2% retracement of this year's rally. For the Asian shift, we have the RBA minutes.  

At the last meeting, there was no change in rates, but the statement was considerably less dovish than the market is expected, supporting the Aussie on a  1%  rally on the notion that the RBA's assessment suggest that the current cash rate should be sufficient for CPI to return to target and that the April rate cut could be the last for some time to come. While there are no surprises expected from the minutes, markets will be looking for any clues on how the RBA foresees interest rates in the foreseeable future for Australia.

In respect to the exchange rate, it was however from the RBA clear that the continued strength in the Aussie will increase the risks of another rate cut and the shockingly weak US Labour data and the perception that the Fed is likely to hold from a hike this summer could be a concern for the RBA and such remarks could weigh on the Aussie today.

AUD/USD levels

0.7480 is a key upside resistance that if broken exposes 9th of June highs on the 0.75 handle. 0.7590 is the next key objective as the early June base. However, the case for the upside is technically compelling according to the 4 hours chart as Valeria Bednarik, chief analyst at FXStreet shows. 

"The technical indicators are retreating from near overbought territory,  still within positive territory, with the RSI pretty much flat around 62 and the price holding well above a bullish 20 SMA, all of which should keep the downside limited."

However, to the downside on an overly dovish set of minutes, the Aussie could drop as far as 0.7400 as first key target with the 20 dma located at 0.7338 and 0.7275 has the 200 dma in its vicinity.