AUD / USD is trading above 0.7400 for the first time since August 2018 today
And the rise could still have legs, as the dollar is in a very difficult situation, and more so since the RBA has not made any offensive remarks to Australian buyers.
A few takeaways from the earlier RBA decision:
- RBA will do ‘whatever it takes’ to support economic recovery
- RBA may consider other monetary policy options moving forward, but is avoiding any discussion of firm negative rates for now
- Current relaxed position to stay in place for an extended period
- No specific mention of dissatisfaction with the performance of the AUD
Regarding the aussie, this was the paragraph to consider:
The US dollar has depreciated against most currencies in recent months. Given this and the rise in commodity prices, the Australian dollar appreciated, to be around its highest level in almost two years.
There is a nod to the aussie’s rise to two-year highs, but that’s basically it.
From a technical standpoint, the AUD / USD still looks perky after a breakout of the 200 week MA (blue line) last week and buyers are now contesting a break above the December 2018 high at 0 , 7394.
Keep above that and 0.7400 and the next key target will be the 0.7500 level.
As the dollar looks fragile and the RBA continues to signal everything, there is a strong case for the AUD / USD to continue pushing higher going forward.