FxWirePro: AUD/USD spikes as markets price out rate cuts post publication of RBA minutes
Minutes of the May 3rd RBA meeting were not as dovish as expected, AUD/USD spiked past the 0.73 handle. Minutes revealed that "members discussed the merits of leaving interest rates on hold but decided on balance that a …
Minutes of the May 3rd RBA meeting were not as dovish as expected, AUD/USD spiked past the 0.73 handle.
Minutes revealed that "members discussed the merits of leaving interest rates on hold but decided on balance that a cut would help return inflation to target over time.
Markets currently pricing out RBA rate cuts post publication of minutes, expect a potential more cautious approach towards cutting rates again.
Technically, on the 4H charts the pair has broken strong trendline resistance at 0.7285, and has hit session highs at 0.7366.
Upside finds stiff resistance at 0.7375 (4H 55-EMA), further upside only on breaks above.
Above 0.7375 the pair finds next resistance at 0.74, 0.7457 (4H 110 EMA) and then 0.7380 (May 12th highs).
Currently the pair has given up some gains to trade at 0.7347 levels, with supports on the downside located at 0.7258 (200-DMA) and further below at 0.7212 (61.8% Fib of Jan to Apr rally).
Close below 200-DMA at 0.7259 will see test of 0.7212. Break below could see test of 0.7043 (78.6% Fib).
