RBA’s much less dovish-than-expected choice supported the Aussie earlier at the moment!
As anticipated, the Reserve Financial institution of Australia (RBA) determined to maintain its rates of interest at 4.35% in February.
The central financial institution additionally acknowledged that inflation has eased, however was nonetheless unsure concerning the tempo of its return to RBA’s 2% – 3% goal vary.
AUD/USD 4-hour Foreign exchange Chart by TradingView
What caught merchants’ consideration was that Governor Bullock and her group didn’t drop the prospect of future rate of interest hikes, saying that “additional enhance in rates of interest can’t be dominated out.” For those who recall, central banks just like the Fed and the Financial institution of England (BOE) have joined the doves’ aspect with their rate of interest reduce biases.
Keep in mind that directional biases and volatility situations in market value are sometimes pushed by fundamentals. For those who haven’t but completed your fundie homework on the Australian and the U.S. {dollars}, then it’s time to take a look at the financial calendar and keep up to date on day by day elementary information!
How excessive can AUD/USD fly earlier than the bears step again in?
AUD/USD discovered assist from the S1 (.6470) Pivot Level line and it appears to be like able to retest the .6550 psychological deal with. As you may see, the world additionally traces up with a earlier assist, the Pivot Level (.6550) space, and a development line resistance that hasn’t been damaged for the reason that begin of the 12 months.
A rejection across the earlier inflection level may attract AUD/USD sellers and up the chances of the pair dropping again to its intraweek lows. Australia received’t be printing any extra financial studies at the moment however market themes or headlines which will enhance USD demand may put new weekly lows on the desk for AUD/USD.
In fact, we’re not ruling out the opportunity of AUD extending its upswing towards USD.
If AUD bulls maintain their momentum, or if the subsequent buying and selling classes‘ headlines favor risk-taking, then AUD/USD might get sufficient push to retest (and possibly even break) the development line resistance that we’re eyeing.
The .6600 – .6650 space might appeal to profit-takers if we do see sustained AUD/USD demand within the subsequent couple of days.
What do you suppose? Which means will AUD/USD go?
