Technical Analysis – AUDUSD consolidates ahead of RBA policy meeting
February 3, 2014 9:53 am
AUDUSD has been range- bound since reaching a more-than 3-year low of 0.8659 on January 24.
The pair is consolidating ahead of a key risk event on Tuesday, when the Reserve Bank of Australia is expected to keep rates on hold. The reduction of easing expectations is keeping the pair supported above this 0.8659 level. Resistance at 0.8825 is keeping the pair capped for now.
The daily chart shows a bearish bias as prices headed lower since the October 23 high. Both moving averages are falling (SMA20 and SMA 50), with the market capped below them. The RSI is flat and just below the 50 mark which separates bullish and bearish territory. In the past week (since Tuesday January 28), price action has been centered around the 23.6% Fibonacci retracement level (0.8761) of the down-leg from the January 13 high (0.9085) to the January 24 low (0.8659). This level is acting as a key turning point, as the RBA announcement tomorrow will give the pair a clearer direction.
A break out of its current range will propel the pair higher to resistance levels at 0.8920 and at 0.9085 while a break lower will target the 0.8659 low and the 0.8600 psychological level.
AUDUSD has been range- bound since reaching a more-than 3-year low of 0.8659 on January 24.
The pair is consolidating ahead of a key risk event on Tuesday, when the Reserve Bank of Australia is expected to keep rates on hold.
The reduction of easing expectations is keeping the pair supported above this 0.8659 level. Resistance at 0.8825 is keeping the pair capped for now.
The daily chart shows a bearish bias as prices headed lower since the October 23 high. Both moving averages are falling (SMA20 and SMA 50), with the market capped below them. The RSI is flat and just below the 50 mark which separates bullish and bearish territory.
In the past week (since Tuesday January 28), price action has been centered around the 23.6% Fibonacci retracement level (0.8761) of the down-leg from the January 13 high (0.9085) to the January 24 low (0.8659). This level is acting as a key turning point, as the RBA announcement tomorrow will give the pair a clearer direction.
A break out of its current range will propel the pair higher to resistance levels at 0.8920 and at 0.9085 while a break lower will target the 0.8659 low and the 0.8600 psychological level.
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