The Australian dollar has flat lined today as the markets wait to hear the result of the RBA minutes shortly after midnight GMT. It's no surprise that the markets are always interested to hear what is on the Reserve Bank of Australia's mind in relation to the economy. However, one of the major factors is the change in forecasting from the RBA, as it moves to midpoint forecasting rather than the current ranges. Markets accordingly have some estimates and ideas what this means for GDP and inflation forecasts, but obviously no one is quite sure they'll get it right the first time. I don't think it will have a massive impact given the market has been aware of it for some time. Instead I think for the AUDUSD will be focused on the tax plan in the US which was expected to be quite strong, but has so far failed to impress investors and traders alike - with many thinking it may be too hard a sell to get across the floor of the senate.
AUDUSD traders have so far been looking to bounce higher, the market thus far has been not exactly agreeable as it keeps the AUDUSD pinned within a tight range. This is unusual for a commodity currency and I feel it's a case of pressure building before a breakout, as the AUDUSD does love to trend in the long run. Resistance at 0.7687 is quite strong at present and coupled with the 200 day moving average is very hard to beat. The next level up from here can be found at 0.7748, with the potential for it to carry higher if it does manage to beat the 200 day moving average. Support levels also remain quite tight at 0.7624 and 0.7560 at present and I would expect these to hold unless we saw some major economic change.
On the other side of the world Brexit still remains a major issue, and the recent moves by the Tory party to secure it all seems to be causing waves. So far the UK government is looking to use legislation to fix the time and date of the exit from the Euro-zone. Obviously markets will take this with a grain of salt, given the recent debacles in government to get it through.
For the GBPUSD it's a weird mix at present as markets have pushed it against the current trend line looking to see if there is a bounce higher or if it will crack and even plunge again. It's hard to say where direction lies at this stage, but support at 1.3109 continues to hold up against any further falls with the trend line and next level at 1.3023 acting as the line in the sand for traders. Resistance levels can be found higher up at 1.3219 and 1.3339, in the advent the bulls did come back into the market. But at present it's a real wait and see when it comes to markets actually moving.
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