AUD/USD breaks out of a narrow range following the Federal Open Market Committee (FOMC) meeting, but the broader outlook remains tilted to the downside as the Reserve Bank of Australia (RBA) remains reluctant to lift the cash rate off of the record-low.
In light of the recent price action, AUD/USD looks poised for a larger recovery ahead of the next RBA meeting on November 7 as it initiates a fresh series of higher highs & lows. However, a 310K expansion in U.S. Non-Farm Payrolls (NFP) may temper the near-term rebound in the exchange rate as it encourages the FOMC to deliver a December rate-hike.
At the same time, a head-and-shoulders formation appears to be taking shape in AUD/USD following the break of the neckline around 0.7720 (23.6% retracement) to 0.7770 (61.8% expansion), and the pair may continue to give back the advance from the summer months should RBA Governor Philip Lowe and Co. continue to endorse a wait-and-see approach for monetary policy.
AUD/USD Daily Chart
GBP/USD gives back the advance from earlier this week even as the Bank of England (BoE) raises the benchmark interest rate for the first time since 2006, and the pound-dollar exchange rate may continue to consolidate over the near-term as the central bank appears to be in no rush to further normalize monetary policy.
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