RBA minutes preview: what to expect in AUD/USD?
The Aussie has been firm in the recovery from early August significant level of 0.7635/40 after a large amount of supply from 0.7760 highs and a break of the 0.77 handle as we approach the RBA minutes as the key event for the Asian session today.
For the overnight session, the Aussie was firmer on the price of oil recovering, lifting sentiment and with broad based weakness in the greenback, the Aussie was able to climb back into the ascending channel formed at the midpoint of the 0.74 handle in late July that hit a roadblock at 0.7760 recent highs.
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The RBA are the next fundamental catalyst after the RBA cut interest rates by 25bps to the lowest level on record concerned about their inflation target and the level of the Australian dollar. However, no matter the outcome, as explained by analysts at ANZ, "with the Fed still dovish and global liquidity ample, the hunt for yield still favours AUD over the short-term."
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What to expect in the minutes?
The analysts at ANZ explained, "With the SoMP released just after the August Board meeting, the minutes are unlikely to contain too much extra detail. That said, we’ll be looking for the Board’s discussion around the AUD and how its strength is impacting the non-mining recovery. The commentary around housing will also be of interest to gauge just how comfortable the RBA actually is with the property market."
AUD/USD levels to monitor
The obvious and psychological level is the 0.77 handle with spot trading at 0.7679 currently at time of writing. The first resistance ahead is at 0.7685 (Daily High), then 0.7690 (Hourly 100 SMA), 0.7693 (Yesterday's High), 0.7702 (Daily Classic R1) and 0.7702 (Monthly High). Support below can be found at 0.7674 (Daily Classic PP), 0.7674 (Daily Open), 0.7674 (Hourly 20 EMA), 0.7672 (Daily Low) and 0.7669 (Weekly Classic PP). Looking to candlestick patterns, we can see a Dark Cloud Cover formation on the 4-hour chart .