Australian Dollar: RBA hike hopes lift AUD against US Dollar - Societe Generale

Societe Generale strategists note that AUD/USD has rebounded from a multi-month ascending trend line near 0.6900 and is holding above 0.7000 ahead of the Reserve Bank of Australia's (RBA) policy decision. The pair faces resistance at 0.7050/0.7080, while a move above its 200-day moving average could strengthen the recovery. Conversely, a break below 0.7000 could expose further downside towards 0.6900 and 0.6860/0.6830.

RBA decision and technical levels

"Spot steadies above 0.70 handle ahead of RBA decision tomorrow."

"AUD/USD has bounced after defending a multi-month ascending trend line near 0.6900."

"The pair has reached the confluence of the 50-DMA and the 200-DMA at 0.7050/0.7080, which represents an interim resistance zone."

"All else being equal in stocks and metals, an upgrade should in theory be a fillip for AUD/USD and nudge the pair back above the 200dma (0.7066)."

"It will be important to observe whether it can overcome this hurdle. Last week's low at 0.7000 is the first support. A break below this could trigger a deeper down move."

"In that scenario, the next supports could be located at the ascending trend line near 0.6900 and the March low at 0.6860/0.6830."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)