Trading AUD/USD
The Australian Dollar (AUD) inched higher against the US Dollar (USD) on Monday, increasing the price of AUDUSD to more than 0.7700 ahead of the Reserve Bank of Australia (RBA) monetary policy meeting minutes. The technical bias shall remain bullish because of a higher high in the ongoing upside rally.
How to Trade Today’s RBA Minutes
- Buying the AUDUSD put options can be a good strategy if the RBA minutes hint at a potential rate cut or dovish monetary policy stance for upcoming months.
- Alternatively, buying the AUDUSD call options may be a good move if the RBA minutes show a potential rate hike or hawkish monetary policy stance for upcoming monetary policies.
Reserve Bank of Australia
The Reserve Bank of Australia (RBA) is schedule to release its monetary policy meeting minutes today during the late US trading session. The minutes of the Reserve Bank of Australia meetings are published two weeks after the interest rate decision.
Find today’s RBA Minutes release here at 0:30 GMT
Generally speaking, if the RBA is hawkish about the inflationary outlook for the economy, then the markets see a higher possibility of a rate increase, and that is positive for the AUD and vice versa.
The minutes give a full account of the policy discussion, including differences of view. They also record the votes of the individual members of the Committee.
Technical Analysis
As of this writing, the pair is being traded around 0.7725. A hurdle can be noted near 0.7731, an immediate trendline resistance ahead of 0.7770, another trendline resistance zone as demonstrated with red color in the given below daily chart. A break and daily closing above the trendline resistance shall incite renewed buying interest, validating a move towards the 0.8000 resistance zone.
On the downside, a support can be noted around 0.7662, a short term horizontal support ahead of 0.7450-0.7475, the confluence of 50% fib level as well as another trendline support area and then 0.7159, the swing low of the last major downside move. The technical bias shall remain bullish as long as the 0.7490 support area is intact.
How AUDUSD Reacted on Past RBA Minutes?
Last time the RBA released its minutes on 21st February, 2017.
The AUD/USD pair fell broadly after the release of February minutes as the central bank indicated lower interest rate for a longer period of time
The pair however rose by more than 50 pips after the release of December 2016 RBA minutes as the central bank signaled no rate cut in near future.
