AUD/USD – Little Movement Ahead of RBA Minutes

The Australian dollar is showing little movement on Monday, as AUD/USD trades in the mid-0.87 range late in the European session. It’s a quiet start to the week, with no releases out of Australia. Early on Tuesday, the RBA will release the minutes of its last policy meeting. In the US, Monday’s sole release is a speech from FOMC member Jerome Powell.

The Australian dollar finds itself well below the 0.90 line, yet the RBA has stated more than once that the currency remains overvalued and is weighing on the fragile Australian economy. We could see this stance reiterated in the RBA minutes, which will be released on Tuesday. The RBA is not expected to make any changes to monetary policy, so any hints in the minutes about a rate move could shake up AUD/USD.

US releases wrapped up the week on a high note, as UoM Consumer Sentiment climbed to 86.4 points, its highest reading since July 2007. The markets had expected a reading of 84.3 points. This indicates that the US consumer remains optimistic about the economy and is not overly concerned about warnings of a global slowdown. On the housing front, Building Permits and Housing Starts met expectations. Strong US employment numbers continue to drive the US recovery, as US job claims dropped to 264 thousand, marking a 14-year low. The estimate stood at 286 thousand.

AUD/USD for Monday, October 20, 2014

AUD/USD October 20 at 12:30 GMT

AUD/USD 0.8778 H: 0.8788 L: 0.8750

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.8550 0.8668 0.8763 0.8820 0.8953 0.9020

 

  • AUD/USD has been marked by choppy trading in the Asian and European sessions.
  • 0.8820 is an immediate resistance line. 0.8953 is next.
  • 0.8763 is a weak support line. 0.8668 is stronger.
  • Current range: 0.8763 to 0.8820

Further levels in both directions:

  • Below: 0.8763, 0.8668, 0.8550, 0.8456 and 0.8315
  • Above: 0.8820, 0.8953, 0.9020 and 0.9119

 

OANDA’s Open Positions Ratio

AUD/USD ratio is unchanged on Monday. This is consistent with the limited movement displayed by the pair. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD climbing to higher ground.

 

AUD/USD Fundamentals

  • 14:00 US FOMC Member Jerome Powell Speaks.

* Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.