AUDUSD On Pace To Post A Fifth Consecutive Day Of Gains
BUZ INVESTORS AUDUSD On Pace AUD/USD fell under pressure following the release of the Reserve Bank of Australia’s monetary policy meeting minutes but turned higher in European trading to release early day gains. Despite the pair remaining below yesterday’s high, it is on track to post a fifth consecutive day of gains.
The RBA meeting minutes revealed that the bank held its neutral stance towards monetary policy which was largely expected. The central bank discussed various reasons why earlier employment gains were concentrated to part-time jobs but also indicated that first quarter employment growth saw a rise in full-time employment. A recent increase in mortgage rates left the central bank optimistic regarding a slowdown in the housing market although the impact may take some time to filter through and the housing market will continue to be closely monitored as well as the labor market.
AUDUSD On Pace
Trade Idea AUDUSD Buy at 0.7370
As aussie found good support at 0.7329 and has staged a rebound, suggesting a temporary low is possibly formed there and consolidation with mild upside bias is seen for further gain to 0.7470-75, then 0.7500-10 but break of latter level is needed to add credence to this view, bring subsequent rise towards resistance at 0.7556 which is likely to hold from here due to near term overbought condition.
In view of this, we are looking to buy aussie on dips as 0.7360-70 should limit downside. A break of said support at 0.7329 would abort and signal recent decline is still in progress for weakness to 0.7295-00 (76.4% retracement of 0.7158-0.7750), however, loss of downward momentum should prevent sharp fall below 0.7300 and reckon 0.7245-50 would remain intact, bring another rebound later.
On the 4-hour chart, the move from 0.8066 is the wave 5 with i: 0.8860, ii: 0.8315, wave iii is an extended move ended at 1.0183, iv: 0.9706 and wave v has ended at 1.1081 (also the top of entire wave 5). The subsequent selloff is the major correction which is unfolding as ABC-X-ABC and 2nd A leg has ended at 0.8848, followed by a-b-c wave B which ended at 0.9758, hence, 2nd C wave is now in progress and indicated downside target at 0.7000 and 0.6950 had been met, so further fall to 0.6710-20 cannot be ruled out.
|5836.90||5878.30||6828.70||1358.50||1992 – 2017||points||Daily|
|Government Bond 10Y||2.64||2.63||16.50||1.83||percent||[+]|
|2 Year Note Yield||1.69||1.71||5.26||1.43||percent||[+]|
|5 Year Note Yield||2.17||2.19||5.50||1.48||percent||[+]|