EUR/USD completed the fourth negative day while euro slipped lower ahead of Eurozone’s CPI coming out today, which may impact ECB’s tightening plans. Aussie dropped below 100-day SMA after RBA minutes published. USD/JPY is developing within a downward sloping channel in the last seven months.
Aussie Fell Following RBA’s Stance for Policy Tightening in the Minutes
Aussie edged lower after the Reserve Bank of Australia used its last policy meeting minutes to deny that will raise rates. On October 3rd, the central bank left its official cash rate on hold at 1.50% as expected and mentioned that policymakers do not see “mechanical implications” to tighten the monetary policy, despite the tightening actions from the U.S. and Europe. Moreover, they expressed their concerns about the strength of the Australian dollar, as the AUD/USD pair remains close to two-year highs.
AUD/USD – Technical Outlook
The Australian dollar is posting a bullish tendency against the U.S. dollar since January 2016 and added more than 8% to its performance. Going to the medium-term timeframe, the AUD/USD pair experienced its first positive week after four bearish periods and almost challenged the 0.7900 psychological level. However, on yesterday’s session, the commodity currency pair posted a bearish day and plummeted below the 100-day SMA.
The next level to focus on is the 0.7750 support level in case of further bearish tendency. On the daily chart, the MACD oscillator is flattening in the bearish path above the trigger line, whilst the RSI indicator is pointing to the downside with weak momentum.
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