The RBA just announced a larger than expected hike today!
Can this be enough to sustain the uptrend on AUD/USD?
Before moving on, ICYMI, yesterday’s watchlist checked out the uptrend on AUD/USD ahead of the RBA decision. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
RBA hiked interest rates by 0.50% to 0.85%
RBA statement highlighted strong inflation and resilience of Australian economy
RBA officials expressed concerns on household spending and house prices
BOJ head Kuroda: Now is not the time for an exit strategy
Kuroda: Big JPY decline is negative for the economy
New Zealand ANZ commodity prices sink by 2.8%, following earlier 1.9% slump
German factory orders tumbled by 2.7% vs. estimated 0.4% uptick
SNB foreign currency reserves unchanged at 925 billion CHF
Upcoming Potential Catalysts on the Forex Economic Calendar:
Canadian Ivey PMI at 2:00 pm GMT
Treasury Secretary Yellen’s speech at 2:00 pm GMT
New Zealand GDT auction coming up
U.S. consumer credit data at 7:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: AUD/USD
I’ve still got my eye on AUD/USD for today!
This time, I’m staying on the lookout for a potential channel breakdown, even after the RBA announced a larger than expected rate hike.
You see, the pair got a quick boost during the event, but the rally was short-lived. Could it be that market watchers are no longer expecting more RBA hikes soon?
In any case, I’m still waiting on more confirmation for an uptrend continuation or reversal. A move above the area of interest around the .7200 handle could confirm that the rally could resume and take AUD/USD back to the channel top soon.
Technical indicators seem to be pointing to more gains, as the 100 SMA is above the 200 SMA to reflect bullish momentum. In addition, the 200 SMA held as dynamic support near the channel bottom.
At the same time, Stochastic is pulling higher from the oversold region to indicate that buyers are returning while sellers take a break.
There’s not much in the way of top-tier data from the U.S. today, though, so AUD/USD price action could also hinge on risk appetite. Good luck out there!
