RBA governor Debelle outlined the new changes coming to AUD and Australian markets. The changes are huge with wide implications for AUD and the changes are consistent with the revamp in the remainder of central banks. I long saw the problems in AUD and reported it in many blog posts over past months as AUD prices slowed to 10 pip daily ranges. I thought then the RBA had to lower OCR to align AUD more properly, now I’m not so sure lower OCR is the way. I believe so far AUD can operate under the new changes without an OCR cut but this is very early assessments as the speech was 2 days ago. AUD will see the slowdown as I mentioned in EUR and other pairs but time exists before implementation of the new changes.
Daily AUD ranges doubled from 10 pips to current 21 pips but again AUD is held inside the ranges. AUD/USD big support points below are found at 0.7141 and 0.7133. For today, bottoms are found at 0.7212 and 0.7200. Central banks are driving AUD as last week and Year to date, AUD is most bought currency by huge and wide margins.
AUD target for today is 0.7278 but vital range points must break at 0.7240 and 0.7258. Below to target 0.7212 and 0.7200, price must break 0.7240 and 0.7238. Look for sell points at the 0.7230 and 0.7258 points. Below 0.7238, targets 0.7212. again, ranges are small, 21 pips so big moves aren’t ahead. Slow and steady is the way. And AUD direction is down and will head far lower over time from current prices.
AUD/CAD. Vital points, below 0.9812, 0.9800 V above 1.0017. Any rises sees overbought and consistent with AUD/USD as rises in AUD/USD becomes overbought most particularly seen at the 5 and 10 day averages for today.
Brian Twomey, Inside the Currency Market, btwomey.com