AUD/USD marks its longest stretch of advances since September 2007, with the pair at risk of extending the recovery from the December-low (0.7501) as the bullish momentum appears to be gathering pace.
Near-term developments in the Relative Strength Index (RSI) alters the broader outlook for AUD/USD as the oscillator clears the bearish formation and pushes into overbought territory for the first time July, with the exchange rate at risk of highlighting a similar dynamic as it now threatens the downward trend carried over from September (AUD/USD Bullish RSI Trigger Remains in Focus Ahead of RBA Minutes).Key developments coming out of Australia may keep AUD/USD bid as the region’s trade balance surplus is expected to widen to A$500M from a$105M in October, but the Reserve Bank of Australia’s (RBA) wait-and-see approach for monetary policy may tame the recent appreciation in AUD/USD as Governor Philip Lowe & Co. remain in no rush to lift the cash rate off of the record-low.
In turn, AUD/USD may continue to gain ground ahead of the RBA’s first 2018 interest rate decision on February 6, with the near-term outlook still supportive for the pair as long as the momentum indicator holds above 70.
AUD/USD Daily Chart
EUR/USD struggles to hold its ground as the ISM Manufacturing survey unexpectedly climbs to 59.7 from 58.2 in November, but the pair may cling to the yearly opening range ahead of the U.S. Non-Farm Payrolls (NFP) report as the fresh data prints coming out of the economy fail to boost bets for an imminent Fed rate-hike.
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