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Will the RBA hike boost the Aussie?We are seeing plenty of volatility from the Australian dollar. AUD/USD is trading at 0.6883 in European trade, up 0.98% on the day. The Australian dollar has recovered most of its losses from Friday, when the pair slipped 1.28%. All eyes are on the RBA, which holds its monthly policy meeting on Tuesday. The meeting is live, as it's not clear if the Bank will raise rates by 25bp or 50bp. The most likely scenario is a 50-bp move, with the cash rate at a low 0.85%. A supersize 75bp move is a possibility but unlikely, and would likely give the Aussie a short-lived jump - the markets remain jittery in the current environment which will make it difficult for AUD/USD to claw back to the symbolic 70 level. Inflation remains the RBA's paramount concern. The inflation rate of 5.1% is among the lowest in the OECD and well below the UK and US, which are running close to double digits. Still, there is no sign of Australia's inflation peaking, and that has the RBA worried about inflation expectations becoming unanchored. There are no indications of a recession, but GDP in Q1 slowed significantly to 0.8%, compared to a robust 3.6% in the fourth quarter. If the RBA continues to deliver 50bp rate hikes, economic activity will slow and negative growth would become a very real possibility. US markets are closed for a holiday, but things will heat up during the week, with the FOMC releasing the minutes of its June meeting. The Fed appears intent on continuing to raise rates aggressively, with Fed Chair Powell saying last week that curbing inflation was his primary task right now. Last week Powell said it was important to prevent inflation expectations from becoming anchored, adding that restoring price stability was paramount, even if that mean negative growth. On Friday, the Atlanta Fed GDP tracker indicated that the US is likely already in a recession, with the economy contracting by 2.1% in Q2, which together with the Q1 decline of 1.6% would mean the economy is in recession. AUD/USD is testing resistance at 0.6849. Above, there is resistance at 0.6933 There is support at 0.6732 and 0.6648
by OANDA
Aussie rises ahead of retail salesThe Australian dollar is in positive territory on Tuesday. AUD/USD is trading at 0.6944 in European trade, up 0.28% on the day. Australia releases retail sales for May on Wednesday. Retail sales is the primary gauge of consumer spending, and the markets are braced for a weak reading of 0.3%, following a 0.9% gain in April. Consumers are holding tightly onto their purse strings, as interest rates are on the rise and the cost-of-living crisis is intensifying. A deceleration in retail sales could cause slowdown fears and push the Australian dollar lower. The markets are already nervous about an economic slowdown, with the RBA in the midst of its rate-tightening cycle. The central bank surprised the markets with a super-size 0.50% hike earlier in June, and the RBA could deliver another 0.50% increase at next week's meeting, or stick with a modest 0.25% rise. The cash rate is still relatively low at 0.85%, and the Bank will have to raise rates aggressively in order to curb soaring inflation. On Friday, Governor Lowe stated that there were no plans to raise rates by a massive 0.75% hike at the upcoming meeting. This of course does not rule out the possibility of such a move at later meetings. Lowe suggested last week that wage growth should be about 3.5%, half of the 7% inflation rate that the RBA is projecting by year's end. This would essentially mean a pay cut for workers and could be the recipe for labour unrest if workers demand higher wages to compensate for soaring inflation. Wage growth has been very modest and is not a cause of the jump in inflation; rather, the war in Ukraine and supply chain disruptions, notably in China, have been the primary drivers of inflation. AUD/USD is testing resistance at 0.6936, followed by resistance at 0.7004 There is support at 0.6877 and 0.6809
by OANDA
RBA and China Are Bullish For Aussie- Elliott wavesAussie is trying to wake up as RBA started hiking rates while China is going out of lockdowns in June, so seems like wave C is already in place, unless this is still a higher degree leg A from the 0.7661 highs. Well, at this stage it's too early to confirm any new long-term bottom, but at least in the short-term we should be aware of more upside after recently broken trendline resistance in the first leg, so more upside can be coming after pullback. Support is at 0.7/0.7030 which can be also a base of a right shoulder on 4h chart. Also, HSI has made a nice turn up recently which can be positive for the Aussie.
Long
by ew-forecast
Australian dollar dips as rate rally fizzlesThe Australian dollar has reversed directions on Wednesday and is slightly lower. AUD/USD is trading at 0.7209, down 0.28% on the day. The RBA surprised the markets with a supersize rate hike of 50bp yesterday, double what most analysts had predicted. The Australian dollar responded with a swing of close to 100 points and held onto half of those gains. However, any hopes of a sustained post-RBA rally proved to be short-lived, as the Aussie has dipped lower today. The RBA left no doubt that it plans to be aggressive in its battle to curb soaring inflation, and we could see further 50bp hikes down the road if inflation remains stubbornly high. However, the central bank does run the risk of appearing to be in panic mode with such a large hike and runs the risk of losing credibility if inflation doesn't peak soon. The RBA's aggressive hike shows that it "means business", but the rate statement didn't come across as particularly hawkish. Policy makers noted that inflation was higher than expected and was projected to accelerate before declining in 2023. The statement said that the rate hike would contribute to inflation falling "over time", which certainly doesn't provide much insight - perhaps the RBA is playing a wait-and-see game when it comes to forecasting when inflation will peak. Yesterday's massive hike was the RBA's largest increase since 2000. Still, it's worth noting that the cash rate is only at 0.85%, which means that the RBA's rate-tightening cycle is in an early stage and has plenty more room to run. Unless inflation dips dramatically, we can expect the RBA to tighten by around another 100 points by year's end and continue into 2023. This aggressive tightening scheme will help maintain the US/Australia rate differential, with the Fed also in the midst of a rate-tightening cycle. AUD/USD is testing support at 0.7211, followed by support at 0.7138 There is resistance at 0.7280 and 0.7353
by OANDA
AUDJPY BULLS IN CONTROL AS RATES RAISEDThe Reserve Bank of Australia (RBA) has adopted a hawkish stance on interest rates. The RBA raised its OCR by 50 basis points to 0.85 percent, above the 25 basis point rise predicted. In April, the Australian economy added only 4k jobs, compared to the 30k predicted. As a result, market participants saw a 25 basis point rate increase as merely tightening monetary policy. Meanwhile, the Bank of Japan's (BOJ) ultra-easy monetary policy will continue to haunt the yen bulls. BOJ Kuroda's intervention fails despite the fact that the pair is overbought. Haruhiko Kuroda, Governor of the Bank of Japan (BOJ), interjected verbally, stating that the large yen depreciation in a short period of time is detrimental to the Japanese economy.
Long
by TradeyMarkets
5
A Kangaroo Hop!Things seem to be going well down under. With Iron Ore prices jumping close to 8% last week, Australia, the largest exporter of the raw material stands to benefit greatly. In 2021, Iron Ore exports totaled close to US$120 billion. This contributes greatly to the demand side pressure on the Australian dollar. Looking at the charts, the AUDUSD pair is currently trading at the bottom of the channel support on the 1-hr time frame. With the 200-period moving average right below current levels, we think downside resistance will prove strong and prices will bounce off the bottom of the rising channel quickly. Stay tuned to the Reserve Bank of Australia’s meeting tomorrow and time your entry there! Assuming no surprises and the technical supports are intact, we favor the long side for the AUDUSD pair. Entry at 0.7190, stop below 0.712. Targets are 0.7346 and 0.7460. Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios.
CME:6A1!Long
by inspirante
8
Aussie slips after strong NFP reportThe Australian dollar has reversed directions on Friday. AUD/USD is trading at 0.7225, down 0.55% on the day. US nonfarm payrolls are traditionally the highlight of the week, but the Ukraine war, spiralling inflation and surging oil prices have taken up much of the market's attention. This has reduced some of the hype around recent NFP releases, but they still have the potential to move markets. The May nonfarm payrolls report outperformed expectations, with a gain of 390 thousand, above the forecast of 325 thousand. We'll have to give the markets some time to digest the reading, but it's certainly possible that the strong numbers will see investors price in more Fed tightening, which will give the US dollar a boost, especially against the risk-sensitive Australian dollar. AUD/USD has already reacted to the NFP with considerable losses. It will be interesting to see how Fed policy members react to the nonfarm payrolls release, and whether some Fed members call for the Fed to increase the pace or extent of tightening. The Reserve Bank of Australia holds its policy meeting on Tuesday and will continue its rate-tightening cycle. The current benchmark rate is only 0.35% and the Bank is widely expected to hike by 0.35%, which would represent a compromise between a 0.25% and a 0.50% move. With inflation continuing to accelerate, the RBA is expected to raise rates to 3% or even higher, which means that we will likely see the RBA raising rates throughout the second half of the year and into 2023. AUD/USD is testing resistance at 0.7207. Above, there is resistance at 0.7252 There is support at 0.7121 and 0.7076
by OANDA
AUD drifting ahead of retail salesThe Australian dollar started the week with gains of close to one percent but has been mostly drifting since then. AUD/USD is trading quietly, just below the 0.71 line. It hasn't been a very good week on the Australian release front, raising concerns that the economy may be slowing down. Manufacturing and Services PMIs both slowed in May, while Construction Work Done and Private New Capital Expenditure both recorded declines in the first quarter. The week winds up with April Retail Sales on Friday, which is projected to slow to 0.9%, after a 1.6% in March. Australia releases GDP next week, and an underperforming release would likely dampen sentiment towards the Australian dollar. The new Labour government is rolling up its sleeves after its election victory and getting to work. Both Labour and the defeated Liberal party made campaign promises to review RBA operations, including how it targets inflation. The new Treasurer, Jim Chalmers, says he will announce his findings shortly. Chalmers said on Wednesday that he had inherited "very tricky" economic conditions, including rising inflation and interest rates, and a massive trillion-dollar debt. The FOMC minutes didn't contain any surprises, which actually soothed nervous markets. Investors have become increasingly concerned that the US economy might tip into recession. Recent data, such as housing, has been weak, while at the same time that the Federal Reserve has embarked on an aggressive rate-hike cycle aimed at slowing the economy and containing inflation. With inflation still not showing signs of peaking, there have been calls from some Fed officials to deliver a super-super-size 75 bps hike. To the relief of the markets, the minutes appeared to put to rest such a drastic move, as the Fed signalled that it will hike by 50 bps in June and July, followed by a pause in September. This would allow the Fed to monitor the effects of the June and July hikes on the economy and on inflation levels. 0.7118 is a weak resistance line. Above, there is resistance at 0.7196 There is support at 0.6996 and 0.6918
by OANDA
AUD to challenge USD for the throne of King CurrencyAUD/USD has been belted in recent weeks as the USD bullied every major FX pair. The selling is overdone and into major support ahead of the FOMC meeting tonight. Yesterday the RBA raised rates by 0.25% to 0.35% and we have begun the rate hike cycle with the central bank refocused on inflation. We look for buy the rumour sell the fact USD selling tonight after the FED rate hike or for the bond market to begin pricing in more Australia rate hikes than currently priced in.
Long
by easyMarkets
1
Increased Retail Sales Can Be a Positive SignAfter experiencing problems with Covid that disrupted business, of course, it would have an impact on people's purchasing power. Of course, during the recovery period from Covid, Australia was one of the countries that scored a trade balance surplus and retail sales continued to increase. Retail sales in Australia rose 1.6% for the third straight month, results in March showed that retail sales hit a record high of AUD 33.63 billion after a record high, amid continued easing of restrictions. Household goods retail, up 3.4% followed by other retail (2%), cafe, restaurant and takeaway food service (2%), department store (4.1%), food retail (0.5%) and clothing, footwear (0.5%) . Sales in Queensland (3.4%) and New South Wales (1.8%) saw the biggest gains after recovering from floods and extreme rainfall. Indicates that the Australian economy is recovering. Of course this will have an impact on the strengthening of the AUD currency. In monetary policy, the RBA has raised its interest rate by 25 BPS which makes market participants believe that further strengthening will occur for this currency. Market Direction By looking at the above phenomenon, it is certain that the strengthening of the AUD currency in the future can last a long time because it is predicted that the Australian central bank will raise interest rates to reduce the impact of prolonged inflation coupled with positive economic growth. above will affect the pair: Pair AUD/JPY Bullish Entry Buy S1: 90,603 S2: 88,794 S3: 86,954 Take Profit R1: 94,697 R2: 96,920 R3: 98.614
Long
by LeoAndreDarmawan
Today’s Notable Sentiment ShiftsAUD – The Australian dollar rallied on Tuesday after the RBA raised rates by more than expected and signalled further moves ahead, leading investors to wager on a faster tightening in the coming months. The central bank announced a 25 basis point rate hike, taking the Cash Rate to 0.35%, versus consensus for a 15 basis point rate hike, which would have taken the Cash Rate to 0.25%. Commenting on the announcement, NAB queried “does it mean that they will do 40 basis points in June, so we are up to 75 basis points? It is certainly possible. It looks like their narrative and the inflation forecasts that they’re hinting at comes across as fairly hawkish.”
by thunderpips
Aussie stable ahead of RBA decisionIt was another tough week for the Australian dollar, as AUD/USD fell 2.53%. In the European session, AUD/USD is trading quietly at 0.7046. The RBA will be in the spotlight, as it holds its policy meeting on Tuesday. This meeting is live, as it's unclear what policy makers have planned. There's little doubt that the RBA is poised to embark on a rate-hike cycle, keeping in sync with the Federal Reserve and other major central banks. The uncertainty lies in whether the Bank will raise now, and if so, by how much. Inflation continues to spiral, hitting 5.1% in the first quarter. RBA Governor Lowe has long insisted that he would not raise rates until wage growth rose in order to ensure that inflation was not transitory. Well, wage growth is accelerating and nobody is using the T-word when describing inflation. With a robust labour market, the conditions are right for changing gears and moving away from the bank's loose monetary policy. A rate hike of 0.40% would be called for, but there is the issue of the federal election later this month. The RBA does not want to deliver an oversize rate hike in the middle of an election campaign, but at the same time needs to send a message to the markets that it is determined to contain inflation - standing on the sidelines would risk credibility. The compromise (which is the consensus) is that the RBA will raise rates, but only by 0.15%, with a further hike at the June meeting. A small hike will not send inflation on its heels by any stretch, but will send a slightly hawkish message, as this would be the first rate hike since 2011. With the Federal Reserve widely expected to raise rates by a half-point at its meeting on Wednesday, the Aussie could find itself under pressure this week, as it struggles to remain above the symbolic 0.70-line. There is support at 0.6992 and 0.6923 AUD/USD has resistance at 0.7125 and 0.7194
by OANDA
Interest rates, Inflation and how to trade it.Hey Traders, Massive week this week fundamentally for the Forex market. 3 big interest rate decisions being released so I thought there was no better time than now to have a chat about what it is, what it indicates and finally, how traders profit from it. Fed and BOE almost guaranteed to hike rates, RBA is sitting unsure. Have a watch of the video and I am more than happy to have a discussion in the comment section! As always, have a fantastic trading week and I wish you all many profits.
Education
by the5erstrading
4
AUDCHF Heading to the downside? (FUNDAMENTALS)Hey Traders, AUD is showing weakness as the RBA are ready to start hiking rates, this data is usually already priced into the market but it is the meeting minutes which indicate where we are heading into the future. Also expecting lower retail sales data later in the week. CHF is looking rather bullish, on the other hand with not much room for the Monetary Policy to ease the outlook is rather Dovish. The data releases do remain weak but with stocks heading lower I can see money flooding into the CHF. As you can see by the chart, we have formed and broken a clean flag pattern on the 4h timeframe. Keep an eye on how this chart runs and the reaction to the interest rate hikes by the RBA. Good luck traders!
Short
by the5erstrading
1
Australian dollar rebounds on hawkish RBAThe RBA sent a hawkish message to the markets, as the minutes from the April meeting provided a strong hint that a rate hike is coming sooner than had been expected. The minutes cited rising inflation and a tightening labor markets as developments that have "brought forward the likely timing of the first increase in interest rates". The last time the RBA raised rates was back in 2010, so the markets are eagerly awaiting the lift-off of what is expected to be a rate-hike cycle. All four of Australia's major banks are predicting that the RBA will hit the rate trigger in June. With Australians going to the voting booths on May 21st, the RBA would prefer to stay quietly on the sidelines in the middle of an election campaign. Still, the May meeting should be considered live, at least until the April inflation report comes out on April 27th.  A sharp gain in CPI could force the RBA to respond with a rate hike in May, with a strong possibility of a large hike of 0.40%. Things appear much simpler for the Federal Reserve, which is widely expected to increase rates by 0.50% at its meeting in early May. Fed members, including the more dovish ones, have been sending out the message that the Fed must take aggressive action in order to contain soaring inflation, which hit 8.5% in March. On Monday, Fed member Bullard, a hawk, said that the Fed rate might need to rise to a "neutral" rate of 3.50% and suggested that a 0.75% hike was a possibility. Bullard's stance isn't a reflection of Fed policy, but the very suggestion of a 0.75% hike illustrates that the Fed plans to come out swinging come May. There is resistance at 0.7427, followed closely at 0.7462 There is support at 0.7324 and 0.7256
by OANDA
What is going on with AUD?AUD/USD has baffled trading breaking out of the years range to the topside last Tuesday after the RBA changed to a hawkish stance. AUD/USD rally was reversed sharply later in the week as US yields exploded and Oil eased back on Chinese lockdowns. Still market is expecting RBA to raise in June now so if the USD rally based on US Bond yields can stop or reverse then the AUD is in poll position to rally first. Big cluster of support here with 0.7380 old support and 0.7350 the trendline support for the whole uptrend. easyMarkets Account on TradingView allows you to combine easyMarkets industry leading conditions, regulated trading and tight fixed spreads with TradingView's powerful social network for traders, advanced charting and analytics. Access no slippage on limit orders, tight fixed spreads, negative balance protection, no hidden fees or commission, and seamless integration. “Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, are intended only to be informative, is not an advice nor a recommendation, nor research, or a record of our trading prices, or an offer of, or solicitation for a transaction in any financial instrument and thus should not be treated as such. The information provided does not involve any specific investment objectives, financial situation and needs of any specific person who may receive it. Please be aware, that past performance is not a reliable indicator of future performance and/or results. Past Performance or Forward-looking scenarios based upon the reasonable beliefs of the third-party provider are not a guarantee of future performance. Actual results may differ materially from those anticipated in forward-looking or past performance statements. easyMarkets makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or any information supplied by any third-party."
Long
by easyMarkets
GET READY FOR SHORTFX:EURAUD The correction that occurred in the Australian currency was caused by a decrease in the trade balance in that country, causing corrections in several Australian currency pairs such as, AUD/USD , GBP/AUD , EUR/AUD and so on. Bearish potential still exists in the pair EUR/AUD Need to be careful, the rising inflation rate in Europe due to the turmoil of war, made the ECB want to raise interest rates in order to reduce the impact of inflation. This could cause an upward correction for the Euro.
Short
by ellael_ella
AUD/USD Outlook (5 April 2022)Overall, AUD/USD have been trending upwards. Following the RBA rate decision and statement, the AUD/USD rose significantly. The Reserve Bank of Australia rate decision to be released on Tuesday (5th April), indicated: - Unemployment rate to fall to below 4 per cent this year and to remain below 4 per cent next year. - Inflation has increased in Australia, but it remains lower than in many other countries; in underlying terms, inflation is 2.6 per cent and in headline terms it is 3.5 per cent. -The Board has wanted to see actual evidence that inflation is sustainably within the 2 to 3 per cent target range before it increases interest rates. These signalled for earlier rate increases possibly in May (previously expected towards the end of the year) Following the trend, look for buying opportunities of AUD/USD if price continues to break above the resistance zone of 0.76000. Next resistance zone is at 0.78000.
Long
by JinDao_Tai
AUDCHF: Trend Continuation Likely As Prices Could Aim For 0.72!With rising inflation, the commodities linked currencies such as the AUD are set to keep appreciating in the near future! whereas on the other hand, the safehaven currencies such as the JPY and in this case the CHF, are all but set to drop in value in the coming months. This vast difference is based on the country's economic policies outlook. Here we are looking at the AUDCHF weekly chart and based on the fundamental outlook, trend continuation is a likely scenario. Now coming to the technical analysis part, AUDCHF has been in an uptrend for a long time and currently the price has tested the 0.70000 psychological resistance. The next resistance beyond 0.7000 lies at the 0.72000 region, however for this target to be attained, the concrete psychological resistance of 0.7000 must be cleared. The main criteria for this trade to be valid in this scenario would be for the monthly candle to close above 0.70000 psychological resistance. This would likely ensure that the level is cleared and thus the prices are ready to head higher. The stop loss should be placed beneath the rising weekly trendline and swing low. The take profit should be set at the next swing high, which is the 0.72000 region. Once the criteria is met, as for all the trades, a 1:1 RR is necessary to manage the risk. In this case we need to wait for the price to retrace if the criteria is met. Retracement should hit 0.68000 level after which a LONG trade could be executed. This would ensure we have a 1:1 RR. However shall the criteria be met and the take profit is hit first, then the trade becomes invalid!. Have a look at the main chart for clear picture on the instruction and explanation above. Cheers, I hope you find this insight helpful. Please LIKE & FOLLOW for more insights into Major & Minor currency pairs.
Long
by FX618Analysis
AUDUSD: Await Retrace Before Going LONG! 0.75000 The TargetWith weekly candle breaking out from the descending channel, the price is ready to target the next high at 0.75000. The price also formed good support at 0.70000 area with RSI indicating a bullish divergence! With that all said, it is advisable to wait for the price to retrace at the desired level and then execute a LONG trade. Trade can be invalidated if 0.75000 is HIT first. To get a clear picture have a look at the main chart. Cheers
Long
by FX618Analysis