The Australian Dollar Weakens After RBA Minutes

• 21 Nov 2017

AUD/USD

The AUD/USD pair has entered into a downward channel and given the sentiment of the RBA’s recent meeting, will likely continue. Minutes from the meeting could be described as dovish with interest rates remaining on hold and the suggestion that appreciation of the Australian dollar may slow down economic growth. As a result, the AUD/USD pair moved further into oversold territory, continuing to test the lower Bollinger band and flattening against the 30 oversold area on RSI. MACD also remains bearish.

EUR/AUD

At the opposite end of the scale, the EUR/AUD pair has had a tussle in terms of finding the market top. After a break of the upper Bollinger band the pair attempted a descent which has now been halted by the RBA’s meeting results. MACD continues to show strongly bullish sentiment whereas RSI indicates that the pair is overbought. Volume is steady which may indicate that the pair will remain in range until there is some major fundamental news.

GBP/AUD

The GBP/AUD echoes the pattern seen in the EUR/AUD pair as the Australian dollar struggles against major peers. The pound’s dominance has been illustrated by 8 consecutive bullish candles. The last three trading sessions have resulted in the pair testing the upper Bollinger band and at the same time, RSI has hit the overbought area. Volume remains high into the move indicating interest in the pair, however, further signs are needed to indicate a potential bearish reversal for the pair.

AUD/CHF

There has been some volatility in the AUD/CHF pair as each currency has taking turns to dominate recent trading sessions, however, the overall trend for the pair is bearish. Breaks of the lower Bollinger band has generally resulted in a strong response from AUD buyers. MACD confirms bearish momentum and RSI is bouncing along the 30 support level. Again, further fundamental news will be required to determine near-term direction.