Audusd gains on market optimism ahead of rba policy decision and fomc minutes

AUDUSD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	0.65%	41.5 Pips
Week to-date	0.61%	38.6 Pips
February	2.98%	185 Pips

Upcoming key events (London Time)

Tue 03:30 AM AUD RBA Monetary Policy Decision (Cash Rate Target)
Wed 07:00 PM USD FOMC Meeting Minutes

What happened lately

The Australian economic landscape is currently devoid of any significant economic news. However, the upcoming Reserve Bank of Australia (RBA) monetary policy decision scheduled for Tuesday at 03:30 AM AEDT is anticipated to be a decisive factor in shaping investor sentiment. The RBA’s decision on the cash rate target will likely provide guidance on the future trajectory of Australia’s monetary policy, influencing market perceptions and economic forecasts. With economic indicators showing a mixed economic performance, the RBA meeting outcomes will be closely scrutinized for insights into inflationary pressures and economic growth.

In the United States, the Federal Open Market Committee (FOMC) Meeting Minutes release on Wednesday at 07:00 PM EDT is going to be a high-impact event. The minutes will provide detailed insights into the Federal Reserve’s economic assessment and its members’ views on future policy paths. Investors will particularly keenly evaluate the committee’s stance on interest rates and inflation prospects. With ongoing global economic uncertainties, these minutes could help clarify the Fed’s potential moves, influencing both market expectations and currency valuations.

As for the AUDUSD currency pair, the Australian dollar’s rise of 0.65% to 0.64000 against the US dollar on Monday could be attributed to a combination of market positioning ahead of the RBA’s decision as well as easing concerns about global risks. The increase demonstrates positive investor sentiment towards the Australian currency, likely driven by anticipations of the RBA maintaining a stable or less restrictive policy stance to support economic growth. The outcome of both the RBA meeting and the FOMC minutes will be pivotal in influencing the future direction of AUDUSD. A dovish RBA could weigh on the Aussie, while any signals of a hawkish stance could provide further support. Similarly, hints of a change in the Fed’s monetary policy outlook could shift USD strength, subsequently impacting the AUDUSD dynamics. In these circumstances, currency traders will need to pay close attention to both central banks’ narratives for potential catalysts that could alter the current trend of the pair.

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What can we expect from AUDUSD today?

AUDUSD on Monday rose 0.65% to 0.64000. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for AUDUSD looks bullish as the pair ended higher after Monday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 0.6415 with break above could target R2 at 0.643 or figure level area. While towards the downside, we are looking at daily low of 0.63550 as an important support. Break below this level could weaken the current bullish momentum. A break above 0.64000 may suggest continuation after recent positive movement.

For the week to-date, take note that AUDUSD is bullish as the pair continued to trade higher and is up by 0.61% over the past few days.

Key levels to watch out:

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