RBA Holds Rates Steady-AUD/USD Rallies - Forex News by FX Leaders

RBA Holds Rates Steady-AUD/USD Rallies

Posted Tuesday, April 3, 2018 by
Shain Vernier • 1 min read

The markets appear to be back at full strength after the Easter holiday. The forex is opening up a bit, with several of the majors on the move. The Reserve Bank of Australia (RBA) held the course last night, keeping rates steady at 1.5%. With only a few secondary metrics being released pertaining to the USD this morning, traders have elected to take a long bias to the AUD/USD.

In a live market update from yesterday, I outlined a few scenarios facing the Aussie and the RBA Interest Rate Decision. Let’s take a look at the daily technicals and identify where this market is heading amid the RBA’s aftermath.

AUD/USD Technicals

Simply put, the Aussie continues to trade in heavy rotation. A key topside resistance level has held, with the .7700 handle bringing bears to the market in droves.

AUD/USD, Daily Chart

Here are the levels to watch for the remainder of the session:

  • Resistance(1): 38% Retracement Current Wave, .7696
  • Resistance(2): 20 Day EMA, .7728
  • Resistance(3): Bollinger MP, .7747

Bottom Line: After the early session rejection of the 38% Fibonacci retracement, the AUD/USD looks to have settled into a consolidation pattern. This market is poised for a breakout from the .7700 – .7650 area. In the event that the intraday high of .7706 holds up, a bearish break below .7650 is probable for the near future.

For the rest of the session, I will be looking to sell the 20 Day EMA from .7724. This number is well above the .7700 handle, but it provides a positive entry with the prevailing trend. Using an initial stop loss at .7751, this trade yields 27 pips using a 1:1 risk vs reward management plan.

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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