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  1. #1
    Specialist Member RCox's Avatar

    RBA Rate Decision Sets Up Tuesday Trade in the AUD/USD !!!

    RBA Rate Decision Sets Up Tuesday Trade in the AUD/USD

    The Reserve Bank of Australia will hold its next monetary policy meeting on 04/02/2013 at 3:30 GMT (23:30 EDT). No change in interest rates it expected (meaning rates will likely stay at 3.0%).

    If there are any surprises to this forecast, they would be to the downside (ie. lower interest rates). This would be a very bearish event for the AUD (and positive for the ASX). This is unlikley but we could possibly see a dovish policy statement after the decision. Any suggestion that the RBA is considering lower rates would be very bearish for the currency. Alternatively, a neutral or even hawkish stance (a suggestion rates might rise later this year) would be very positive for the AUD (negative for the ASX). These are the two potential scenarios, and the pair best suited for trades here is the AUD/USD (given the short term weakness seen in the AUD/JPY).

    At writing, current levels to watch come in at 1.0435 (upside breaks suitable for hourly and daily CALLS). To the downside, a better level to watch can be seen at 1.0380 (downside breaks make the pair suitable for hourly and daily PUTS).

    Click image for larger version. 

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  2. #2
    Specialist Member RCox's Avatar
    1.0435 in the AUD/USD did actually turn out to be a good technical breakout area for short term trades (after the Chinese PMI was released). But the levels for the RBA decision will need to be moved higher.

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  3. #3
    Specialist Member RCox's Avatar
    New AUD/USD levels can be found at 1.0450 (for CALLS), and 1.0415 (for PUTS). The upper end of the range a historical resistance level and the 61.8% Fib retracement of the latest decline.

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  4. #4
    Specialist Member RCox's Avatar
    RBA leaves rates on hold as expected. Both suggested bull breakout levels have worked out almost perfectly. But watch for overhead psychological resistance at 1.05, there is likely to be some sellers up there.

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  5. #5
    Solid Member susan's Avatar
    There was good spike in AUD/USD but almost immediately after that it fell again in the 1.0450 area. I think today we will have second test of 1.50 area.

  6. #6
    Legendry Member milos's Avatar
    Reserve Bank of Australia board members come to a consensus on where to set the rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.Reserve Bank of Australia statement is seemed dovish to me. Reserve Bank of Australia do nothing because Australia economy is very good. We have to wait trade balance and see.

  7. #7
    Specialist Member RCox's Avatar
    Nice assessment, Susan. Include a chart for why you think this.

  8. #8
    Specialist Member RCox's Avatar
    Quote Originally Posted by RCox View Post
    RBA leaves rates on hold as expected. Both suggested bull breakout levels have worked out almost perfectly. But watch for overhead psychological resistance at 1.05, there is likely to be some sellers up there.

    Click image for larger version. 

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    Nice assessment, Susan. Include a chart for why you think this.

  9. #9
    Specialist Member RCox's Avatar
    Quote Originally Posted by milos View Post
    Reserve Bank of Australia board members come to a consensus on where to set the rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.
    Yes. This is why the trade recs were placed.

  10. #10
    Legendry Member milos's Avatar
    Today's Range: 1.0447 - 1.0469.
    The economy in Australia is really good.
    I expect it will go 1.055-1.0580.

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