Heading into the end of the Asian session today (Tuesday), the focus turned to the Australian central bank meeting as the market had previously expected monetary policy to move towards a looser direction.
In line with forecasts, the Reserve Bank of Australia (RBA) has kept interest rates unchanged at 3.60%, meaning there will be no increase or decrease in rates at this meeting.
But the central bank still expects some further tightening may be necessary with the objective of bringing inflation down to target levels.
After the reaction of the meeting's results, it can be seen that the Australian dollar began to shrink slightly to trade more gloomy today than yesterday.
On Monday yesterday, it can be observed that the price movement on the chart of the AUD/USD currency pair jumped high with a daily increase of around 130 pips recorded.
This is due to the re-depreciation of the US dollar at the beginning of the week, also driven by the release of survey data for the manufacturing sector in the United States (US) which declined for the month of March.
The price managed to rally from around 0.66600 to reach a recent high of 0.67900 before the bearish pattern started showing again today.
However, the effect of the price decline is slower than yesterday's surge and the price increase has also crossed the Moving Average 50 (MA50) level on the 1-hour time frame on the AUD/USD chart signaling a bullish movement.
If the surge succeeds in continuing again, the price is seen to be heading towards the zone around 0.68300 before extending the increase to the height of 0.69000.
Reaching that height, the latest 6-week high will be recorded.
On the other hand, if the price continues to decline further into the following sessions, the 0.67000 level is the closest one expected to be in focus.
Next, the price surge zone that started yesterday around 0.66600 will be tested again and it is possible that the price can drop even lower.
