- AUD/USD edges lower from 6-week highs at 0.7666, trades rangebound around major trendline resistance at 0.7635.
- RBA expected to leave cash rate at 1.50% for 19th straight meeting and is also expected to retain its neutral stance.
- A hawkish RBA Rate Statement, or one that predicts increasing inflation could be AUD supportive, while a dovish view on the Australian economy could weaken the AUD.
- That said, markets already pricing in stronger than expected Q1 GDP numbers on Wednesday. Forecasts are for a 0.8% increase versus 0.4% prior.
- Technical studies show that the pair has formed a 'Bullish Engulfing' pattern on the daily candle which supports further upside.
- Also, we see bullish divergence from price action on Stochs which adds upside support.
- Upside has broken above 23.6% Fib and 50-DMA. Upside has paused at cloud base and break into daily cloud to see further upside.
Support levels - 0.7605 (50-DMA), 0.7569 (21-EMA), 0.75, 0.7447 (May 15, 16 low)
Resistance levels - 0.7669 (cloud base), 0.7688 (38.2% Fib), 0.77
Call update: Our previous call (https://www.econotimes.com/FxWirePro-Bullish-engulfing-pattern-seen-on-AUD-USD-stay-long-on-break-above-236-Fib-at-07583-1341161) has hit TP1/2.
Recommendation: Book partial profits at highs. Trail SL 0.76. Hold for further upside.
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