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  • AUD/USD is trading in the red below the 50-hour moving average hurdle even though Australia’s fourth-quarter current account deficit narrowed more-than-expected.  
  • The Reserve Bank of Australia (RBA) is expected to keep rates unchanged. The focus would be on the tone of the policy statement.  

AUD/USD is currently trading in the red at 0.7086, having clocked a low and high of 0.7076 and 0.7097 earlier today.  

Australia’s current account deficit narrowed to A$-7.2 billion in the fourth quarter from A$10.7 billion in the fourth quarter. The markets were expecting the current deficit to of A$9.2 billion.  

The better-than-expected data, however, has failed to put a strong bid under AUD/USD, leaving the pair below the 50-hour MA, currently at 0.7090. Notably, the pair has charted lower highs along that average in the last few days.  

Therefore, a convincing break above that average could yield a strong upside move.  

The breakout, however, may remain elusive, if the RBA keeps rates unchanged as expected, but sounds dovish, raising the already high odds of a rate cut in 2019.  

AUD/USD Technical Levels