AUD/USD: Favour buying dips – OCBC

Australian Dollar (AUD) slipped post-RBA yesterday, but dip was brief. Pair was last at 0.6549 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.

Bias remains to buy dips

"A softer USD post-US CPI saw AUD reclaimed 0.65-handle. On RBA, Governor Bullock’s press conference did not indicate any major shift in policy bias. She did say that further moves (referring to cut) are possible if data warrants but she also said that larger cut was not discussed at the meeting. From a FX point of view, RBA is cutting rate from a position of stability not distress."

"Bias remains to buy dips. Bearish momentum on daily chart faded while RSI rose. Resistance at 0.6550, 0.66 levels. Support at 0.65, 0.6430 levels. Week remaining brings labour market report (Thursday)."