AUDUSD Forecast – Aussie Dollar Edges Higher after RBA Rate Hike
The Reserve Bank of Australia (RBA) on Tuesday raised its benchmark interest rate from 3.10 percent to 3.35 percent as widely expected. The move marks the ninth time the interest rate has risen since May last year. The Australian Dollar edged higher after the move.
At 03:49 GMT, the AUDUSD is trading .6941, up 0.0058 or +0.84%. On Monday, the Invesco CurrencyShares Australian Dollar Trust ETF (FXA) settled at $68.00, down $0.50 or -0.73%.
In speaking of the decision, RBA governor Philip Lowe said bluntly in a statement along with the announcement: “Global inflation remains very high”.
Mr. Lowe also hinted that this wouldn’t be the last rate rise of the year.
Daily AUDUSD Technical Analysis
The main trend is down according to the daily swing chart. A trade through .6856 will signal a resumption of the downtrend. A move through .7158 will change the main trend to up.
The minor trend is also down. The new minor bottom is .6856.
The main range is .6629 to .7158. Its 50% level at .6893 was successfully tested on Monday and earlier today.
The short-term range is .7158 to .6856. Its retracement zone at .7007 to .7043 is the primary upside target. Since the main trend is down, sellers are likely to come in on a test of this area.
Daily AUDUSD Technical Forecast
Trader reaction to the main 50% level at .6893 is likely to determine the direction of the AUDUSD on Tuesday.
A sustained move over .6894 will indicate the presence of buyers. If this creates enough upside momentum then look for a surge into the minor retracement zone at .7007 – .7043. Since the main trend is down, look for sellers to come in on a test of this area.
A sustained move under .6893 will signal the presence of sellers. This could lead to a quick test of the minor bottom at .6856. This price is a potential trigger point for an acceleration to the downside with the long-term 50% level at .6760 the next major target.