Sep
6
2010

 

AUD/USD Consolidates Below August Highs

The Aussie is presently consolidating below August highs as investors take a breather ahead of tomorrow’s RBA monetary policy decision.  Although analysts are expecting the RBA to keep its monetary policy unchanged from last month due to economic uncertainty in the U.S., it is likely the RBA’s policy statement will become more optimistic due to the latest round of data from Australia.  In fact, we don’t think it’s outside the realm of possibilities that the RBA surprises by hiking its benchmark rate by another 25bp.  Otherwise, the RBA could make it clear that another rate hike is coming next month baring a considerable fundamental slowdown in the West.  Should the RBA all but guarantee tighter monetary policy in the near-future then investors could price in another rate hike and send the Aussie beyond August highs.  Either way, it’s difficult to be negative on the Aussie considering the data sets we received last week.  The positive Australia data wire continued today with job advertisements growing by 2.3%.  Meanwhile, the BOJ also has a highly anticipated monetary policy decision on tap tomorrow, meaning markets could come alive after a relatively quiet start to the trading week due to the Labor Day holiday in the U.S.      
Technically speaking, the Aussie faces technical barriers in the form of 9/3 and 8/6 highs.   As for the downside, the Aussie has multiple medium-term uptrend lines working in its favor along with 9/3 lows.  Meanwhile, the highly psychological .90 level becomes a technical cushion once again.  
Price: .9157
Resistances: .9164, .9175, .9186, .9195, .9204, .9219, .9239
Supports: .9147, .9135, .9127, .9114, .9096, .9076
Psychological:  .90, August Highs
 
 
 

 
Posted by: Matthew Myers

 

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