AUD/USD renewed lows
AUD/USD slipped below $0.9145 (38.2% of the pair’s advance from 2008 to 2011) to the lowest level since September 2010 in the $0.9060 area. Aussie fell due to extremely dovish comments of the Reserve bank of Australia’s Governor Stevens. According to Bloomberg, traders see more than 50% chance the RBA will cut its key rate to 2.5% at its next meeting on Aug. 6. The key economic data ahead of this event will be next week’s employment report and the Q2 CPI on July 24. The economic data released today showed troubles in retailing, while the lower AUD is helping the nation’s exports.
Support lies at $0.9000 (psychological level), 0.8870 (July 2007 high) and $0.8850 (100-month MA). Resistance lies at $0.9145, $0.9250 and $0.9325.
Aussie’s poised for further decline. Note though that the currency remains oversold. So far we haven’t seen short squeeze, but such risk remains.
Chart. Daily AUD/USD