- For the AUD, the path of least resistance remains to the downside, as indicated by the falling trendline on the hourly chart.
- The pair looks set to re-test Friday’s low of 0.7166 and could see deeper losses if the Reserve Bank of Australia adopts a dovish stance.
- Many in the markets do expect the central bank to turn dovish, courtesy of the recent developments: rise in mortgage costs for Australian holders, weak economic data and escalating trade tensions. As a result, a corrective rally above the falling trendline could be seen if the RBA retains the neutral stance.
Hourly Chart
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Spot Rate: 0.7190
Daily High: 0.715
Daily Low: 0.7187
Trend: Bullish above trendline
R1: 0.7210 (50-hour moving average)
R2: 0.7243 (resistance as per the hourly chart)
R3: 0.7277 (10-day moving average)
Support
S1: 0.7166 (recent low)
S2: 0.7145 (May 32016 low)
S3: 0.71 (psychological level)
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