- AUD/USD is trading with losses below 0.6850 on Monday.
- Investors are watching the RBA minutes and the PBOC’s monetary policy announcement.
- The US stock and bond markets closed for Liberation Day.
The pair AUD/USD accumulates a second consecutive day of losses below the 0.6850 zone, and investors seem to have turned cautious before the publication of the Minutes of the Reserve Bank of Australia (RBA). Also, all eyes will be on the People’s Bank of China (PBoC) monetary policy announcement in a quiet session as US traders celebrate Juneteenth. For the remainder of the week, key US data releases will begin to shape expectations for the Fed’s upcoming monetary policy decision.
Investors await RBA Minutes and US economic data.
Aussie dollar trading dynamics could take a hit following the release of the RBA Minutes early in the Asian session on Tuesday, where investors will be looking for clues to Governor Philip Lowe’s latest surprise move to hike rates 25 points basic, up to 4.10%. That said, the hawkish comments from Lowe and Bullock last week may limit a possible surprise in the Minutes.
On the other side of the Pacific, attention will turn this week to the release of housing data, the S&P PMI and jobless claims. In that sense, Jerome Powell, president of the Federal Reserve, announced last Wednesday a halt in interest rate hikes to give officials more time to gather crucial information and assess their impact on monetary policy. Therefore, macroeconomic data is expected to play a significant role in shaping expectations for the upcoming meeting in July. Furthermore, Chairman Powell’s testimony before Congress on Wednesday has the potential to trigger notable reactions in USD price action.
AUD/USD levels to watch
From a technical point of view, the AUD/USD pair maintains a short-term bullish outlook, according to indicators on the daily chart. Despite the RSI and MACD showing bullish exhaustion, they still remain in positive territory, suggesting further upside in the Aussie’s favor in the near term. Additionally, the 20-day SMA is about to cross bullishly with the longer-term 100-day SMA, which could potentially give the pair additional momentum.
If the AUD/USD manages to rally, the next resistance to watch is at the 0.6850 area, followed by the 0.6900 level and the 0.6920 area. On the other hand, the 0.6800 area is the immediate support level for the pair. A break below this level could expose the 0.6750 area and then pave the way towards the 100-day SMA at 0.6720.
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
