The aussie is down by ~0.9% against the dollar today
It’s been quite the climb down in the aussie after temporarily breaching above 0.7000 against the dollar to end 2019. Since then, price has retreated and now looks on course for a fifth straight day of declines as markets increase bets on the RBA easing next month.
Cash rate futures now see odds of the RBA cutting rates by 25 bps at around 57% and with the dollar also keeping firm today, it is driving price below key technical levels. Of note, price has now slipped back below the 200-day MA (blue line) @ 0.6897.
Further support is seen closer towards the 100-day MA (red line) and the 17 December low at around 0.6830-38 and with there still being room for RBA rate cut bets to go higher, you can’t rule these levels out – especially if upcoming economic data disappoints.
In another key pair for the aussie, AUD/NZD has eased to a five-month low after firmly dropping below 1.0400 – a level which has helped to ease the decline in December.
Technically, it doesn’t bode well for the aussie in the near-term and if the fundamentals line up, it could yet accelerate further losses for the currency ahead of the RBA next month.