The Australian Dollar (AUD) inched lower against the US Dollar (USD) on Wednesday, dragging the price of AUDUSD to less than 0.7680 following the release of minutes from the Reserve Bank of Australia (RBA) monetary policy meeting. The technical bias remains bullish because of a higher high in the recent upside rally.
As of this writing, the pair is being traded near 0.7671. A support may be noted around 0.7647-0.7650, the confluence of the horizontal support as well as the psychological number ahead of 0.7500, another major horizontal support and the psychological number as demonstrated in the given below daily chart.
On the upside, the pair is likely to face a hurdle near 0.7749, the intraday high of yesterday which is also a major horizontal resistance area. A break and daily closing above the 0.7750 resistance area could incite the renewed bullish momentum, validating an upside rally towards 0.7835, the swing high of the latest major upside rally.
RBA Meeting Minutes
The minutes of the Reserve Bank’s latest monetary policy meeting have clouded the outlook for interest rates. The minutes of the August 2 meeting were released on Tuesday. The key to the outlook is the prospect of an extended period of economic growth that’s too slow to chip away at the unemployment rate and, with a delay, to lift wages growth and push inflation up. But just how long the slow growth is expected to last is not as clear as it could be. The RBA board’s monetary policy meeting on August 2 ended with a decision, based on the very same forecasts, to cut the cash rate to a record low of 1.5 per cent.
Considering the overall technical and fundamental outlook, selling the pair around current levels appears to be a good strategy in short to medium term if we get a valid bearish reversal candle in the daily chart.