AUD/USD Started an Aggressive Bearish Run After RBA Meeting Minutes

After the Easter holidays, the Australian dollar dropped sharply versus the U.S. dollar, more than 0.6% in less than 24 hours and erased the half of its pre-Easter gains. AUD/USD appreciation before holidays is attributed to the better than expected Australian employment report and the weakness of the greenback. However, after the pair rose more than 1%, last week, and topped near 0.7610 which coincides with the 50-daily SMA, retreated sharply due to the dovish Reserve Bank of Australia meeting minutes published early today, confirmed that the central bank is cautious about the domestic economy’s outlook. It’s worth mentioning that in the last policy meeting took place on April 4[SUP]th[/SUP], the central bank left its interest rate unchanged at 1.5%.

AUD/USD Started an Aggressive Bearish Run Today
The AUD/USD pair, following the rebound on the 50-daily SMA near 0.7610, a new two-week high, fell sharply and met the other two daily simple moving averages (100 and 200). The sharp sell-off is continuing while the pair is on track to snap a five-day winning streak.

On a medium-term timeframe, the Australian Dollar is developing in an ascending triangle against the U.S. dollar since last January of 2016 with strong resistance level at 0.7780 and a significant valid uptrend line. Our expectation is a further decline if the price slips below the 100 and 200 SMAs on the daily chart. The next level to watch is the 0.7470 support barrier as well as the rising trend line near 0.7300 strong psychological level. The RSI indicator is sloping to the downside endorsing the bearish attitude, as well as the MACD oscillator, is following a negative path. However, MACD climbed above its trigger line but is moving with weak momentum.


Analysis by JFD Research