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AUD/USD: correction in the dollar pairs and oil prices _10/06/2016

PCM Brokers

Technical analysis and trading recommendations - https://fxpcm.com/en/fx/audusd-correction-dollar-pairs-and-oil-prices-10062016

Over the past two days the pair fell by 100 points to the key support level of 0.7400. Calendar is empty on today. The movement of the pair below the 0.7380 level today is unlikely.

Investors' attention will now be focused on Wednesday June 15 when it will be published on the Fed's decision on interest rates in the US, which will open a variety of shopping opportunities, including in the pair AUD / USD.

After Tuesday RB Australia save its benchmark interest rate in the country at the current level of 1.75%, and after the publication of weak US NPF on Friday, the pair AUD / USD rose from the beginning of the month on 270 points, ie by 3.7%, reaching 0.7500.

Previously, in early May, the RBA cut interest rates to a level of 1.75%, for the first time since June 2015. However, in the last days of the events The AUD / USD has played half of the losses of the previous month after the decision of the RBA to lower the rate in the country and the weak NFP.

However, the strengthening of the Australian dollar is probably, positional, and is supported by the increase in oil prices.

In an accompanying statement to the decision to keep rates at the current level of the RBA noted that the current level of rates over time, will stimulate economic growth and contribute to the return of inflation to the target level.

The RBA lowered the forecast of inflation in the country, waiting for him in 2016 of less than 2%. The first time since the 2008 financial crisis in Australia has come deflation.

According to many economists, the low inflation may force the RBA to reduce interest rate in August to 1.5%, and three more times in the next year. Futures markets are pricing in a 50% chance to lower interest rates in Australia in August.

However, the RBA would have room to maneuver after receiving the resultsof the referendum on the UK's membership of the EU and a decision on the interest rate the Fed adopted in June and July.

The balance of risks is still tilted to the lower rates. This will keep the pressure on the pair AUD / USD in the medium term, despite the dynamic short-term upward correction the pair.

Source: https://fxpcm.com/en/fx/audusd-correction-dollar-pairs-and-oil-prices-10062016
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