AUDUSD depicts pre-RBA anxiety over 0.6600, ignoring AUD data

The AUDUSD has paused its three-day advance, although it lacks impetus ahead of the RBA.

The AUDUSD is still trading above 0.6600, indicating trader uncertainty. Ahead of the important Reserve Bank of Australia (RBA) Interest Rate Decision on Tuesday. In doing so, the Aussie pair justified the lethargic markets. Despite a light schedule and conflicting concerns about the US Federal Reserve (Fed), particularly in light of recent disappointing US statistics. As a result, the Australian duo fails to respond to the mid-tier. data at home.

Market mood is dwindling due to a light schedule and conflicting emotions regarding the Fed and the RBA.

Australia’s first-quarter (Q1) current account balance was 12.3 billion. Compared to 5.175 billion predicted and 14.1 billion in the previous quarter. As a result, hawkish RBA wagers gain traction but fail to support the AUDUSD pair ahead of the central bank’s rate decision.

On the other hand, the US ISM Services PMI fell to 50.3 in May, below 51.5 predicted and 51.9 before, while Factory Orders growth slowed to 0.4%, versus 0.5% market predictions and 0.9% previously. It should be noted that the final readings of the S&P Global Composite PMI and the Services PMI were similarly lower in May.

It’s worth noting that the market’s bets on the Fed raising interest rates in June have decreased from approximately 80%. in the middle of the past week to roughly 25% on the disappointing US statistics. The lack of Fed discussions might have added to the pressure on US Treasury bond rates and the US dollar. However, hawkish comments from International Monetary Fund (IMF) Managing Director Kristalina Georgieva, as well as concerns over the need for US major banks to maintain more capital to combat the financial crisis, drive purchasers of the AUDUSD.

Among these bets, Wall Street finished in the negative, with S&P500 Futures printing minor losses by press time. Furthermore, after reversing Friday’s gain, US 10-year Treasury bond rates stay squeezed around 3.68%, while two-year bond coupons preserve the week-start negative bias near 4.46%. today’s marginal increase.”

Technical examination

As the AUDUSD rises off the support line of a falling wedge built in late December 2022 and crosses the 61.8% Fibonacci retracement of October 2022 to February 2023, it is poised to meet a convergence of the 50% Fibonacci retracement level and the 50-DMA, around 0.6660.