AUD/USD testing below 0.7200 as RBA rate call looms
- Bearish Aussie braces for RBA rate call.
- The Australian central bank has been unmoved on rates for over two years, but rhetoric remains an important component of bank-to-market interaction.
The AUD/USD is trading to the downside in the early Tuesday Asian market session as the Reserve Bank of Australia's (RBA) rate statement heads this way.
The Aussie is dropping below 0.7200 ahead of the RBA's latest rate decision at 04:30 GMT, and yesterday's bullish drift saw little momentum, and the pair remains trapped near 2018 lows.
The heavy economic data for Australia will be continuing through the rest of the week, with Aussie GDP figures due tomorrow and Australian Trade Balance numbers on Thursday. The RBA is seen holding steady on rates for the foreseeable future, but traders will be looking for any adjustments to the central bank's policy statements.
AUD/USD levels to watch
Bearish momentum remains close at hand according to FXStreet's Valeria Bednarik: "the intraday recovery (on Monday) seems a correction due to the extreme oversold conditions of the pair, although the bearish potential remains intact. In the 4 hours chart, the price remains below a bearish 20 SMA, which extends its decline below the 100 and 200 SMA, while technical indicators remain well into negative territory, having already lost upward strength. Even in a dollar-weak environment, the Aussie has little chances of recovering ground."
Support levels: 0.7165 0.7130 0.7100
Resistance levels: 0.7225 0.7260 0.7300