- AUD / USD ignores bearish pressure and turns positive on the day.
- The Australian dollar extended the losses after the RBA suggested further monetary tightening.
- The pair approached multi-month lows at 0.7005.
The australian dollar It ignored the bearish tone triggered by the minutes of the last RBA monetary policy meeting and bounced from multi-week lows of 0.7020 to hit the 0.7065 area, turning positive on the daily charts.
The RBA adds pressure to the aussie
AUD / USD resumed its downtrend in early trading on Tuesday and extended its decline from the highs of 0.7240 last week to the October lows of 0.7020 following dovish meeting minutes released by the Reserve Bank of Australia.
The Bank has confirmed the discussion on cutting rates further and buying longer-term debt to support the economy and avoid a strong AUD at the October meeting. This paves the way for further monetary tightening in December, as many market analysts had already anticipated.
AUD / USD approaching major resistance at 0.7005
The Aussie has visited four-week lows on Tuesday, to find support just 15 pips below 0.7005 (September 25 low). A clear move below that level could boost bearish sentiment and push the pair towards 0.6920 (July 7-10 lows) and 0.6815 (June 22 lows). On the upside, the pair should regain the 100-day SMA at 0.71000 to regain the bullish momentum and extend towards 0.7200 (50-day SMA) and 0.7240 (October 9 high).
Credits: Forex Street