AUD/USD falls as RBA holds rate steady while USD/JPY and USD/CNH rally
Outlook on AUD/USD, USD/JPY and USD/CNH as rates remain unchanged for a third consecutive month in Australia and China's services sector expansion disappoints.
AUD/USD resumes its descent as RBA holds rates steady
AUD/USD’s bounce off its near ten-month August low at $0.6365 has been lacklustre with it only rising to $0.6522 before swiftly resuming its descent as the Reserve Bank of Australia (RBA) kept rates on hold for a third month in a row at 4.1%.
The 25 August low at $0.6381 is about to be hit with the August trough at 0.6365 being next in line. If also fallen through, as seems probable, the mid-October high at $0.6348 would be eyed ahead of the November low at $0.6273.
Minor resistance sits at Friday’s $0.6439 low. While the next higher $0.6522 late August high isn’t overcome, the medium-term downtrend remains intact.
USD/JPY has resumed its advance
USD/JPY’s consolidation over the past three months, which took it down to its early September low at ¥144.45, has most likely ended with the August high at ¥147.37 about to be hit as the greenback continues to appreciate.
Now that US market players are expected to re-enter the fray after Monday’s Labor Day holiday, a rise above ¥147.37 would put the psychological ¥150.00 region back on the map.
Minor support can be spotted between the ¥146.56 mid-August high and the ¥146.40 22 August high. The medium-term uptrend will remain valid as long as last week’s low at ¥144.45 underpins.
USD/CNH rallies as optimism around easing measures in China fade
USD/CNH rallies off its two-week August low at ¥7.2392 as activity in China's services sector expands at its weakest pace in eight months.
The break through the one-month resistance line at ¥7.287 puts the late August high at ¥7.3106 on the cards, a rise above which would open the way for the August peak at ¥7.3497 to be reached.
Potential slips should find support between Monday’s high and the late August low at ¥7.2789 to ¥7.2678. Technically speaking the cross remains in a medium-term uptrend as long as it stays above its ¥7.2392 recent low.
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