• AUD/USD edged higher on Thursday as markets reposition ahead of the May 5 policy decision from the Reserve Bank of Australia..
• Expectations for further tightening have strengthened, with futures markets now pricing in roughly an 80% probability of a 25 basis point rate hike.
•This hawkish repricing reflects ongoing concerns about inflation persistence in Australia and has helped provide a modest underpinning to the Aussie.
•On the global front, the Federal Open Market Committee left the federal funds rate unchanged while maintaining an easing bias. However, the presence of three dissenting votes highlights increasing divisions within the committee, suggesting uncertainty around the future policy path.
• At the same time, global factors remain highly influential. The ongoing impasse in the Strait of Hormuz continues to disrupt supply expectations, driving oil prices higher amid renewed geopolitical tensions.
• Immediate resistance is located at 0.7191(Daily high), any close above will push the pair towards 0.7222(23.6%fib).
• Support is seen at 0.7111(38.2%fib) and break below could take the pair towards 0.7020 (50%fib)
Recommendation: Good to sell around 0.7140 with stop loss of 0.7220, and target price of0.7050
