AUD/USD stabilizing on 0.76 handle after RBA induced sell-off

Currently, AUD/USD is trading at 0.7610, up 0.10% on the day, having posted a daily high at 0.7613 and low at 0.7601.

AUD/USD has been consolidating the bear's assault from 0.7680 in a disappointing RBA overnight who remain on hold. They prefer to be unlinked to the shift in tone from their hawkish counterparts elsewhere. However, the RBA did indicate that inflation was expected to rise gradually; the absence of a direct hawkish shift from RBA this month has continued to weigh on the currency though.

RBA: holds at 1.50%, a level maintained since August 2016, but for how much longer? - Nomura

One of the main issues that the RBA face is the prospect of the currency rallying too hard. The market chatter is that this meeting around was more about the Aussie than anything else. The RBA would want to keep a lid on the currency below $0.80c to the greenback. Eyes are now on the FOMC minutes in the US session, however, we do have some event risk later on in the session with the Caixin China Services PMI. Also, keep an eye on Copper; Copper was down overnight and depending on its performance, Aussie traders could look to metals as an additional catalyst for today. 

AUD/USD levels

AUD/USD: Prefer to sell rallies

Valeria Bednarik, chief analyst at FXStreet explained that technically, the pair kept retreating from the critical 0.7700 region. "...seems poised to extend its decline on a break below 0.7575, the immediate support, as in the 4 hours chart, the price is barely holding above a still bullish 20 SMA, whilst technical indicators have turned sharply lower, now pressuring their mid-lines, still not confirming the bearish breakout."