Forex: AUD/USD up to 1.0270 on RBA policy statement

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Forex: AUD/USD up to 1.0270 on RBA policy statement

FITITOL--> FXstreet.com (Barcelona) - The AUD/USD has had a moderate reaction to the RBA SOMP, which appears not to have raised easing expectations more than the market already anticipates, at least that s what price action has been telling the market in the first few minutes post release, with the rate moving down to 1.0250 only to be snapped back up towards 1.0270, session high.

While GDP growth forecast was lowered to 3% from 3.25% last time, the underlying inflation forecast came at 2% through 2012, which suggests the RBA may hold the fire before more rate cuts; AUDUSD response was a spike higher. The RBA added that employment growth is expected to be subdued, with the Eurozone debt crisis still being the most significant external risk. Lastly, it was noted that Chinese growth has been moderating as of late.

According to John Noonan, Head of IFR Markets in Sydney: “Moving average study are on brink of signaling trend lower, with 20, 10 and 5 day moving avearges lining up for down-trend although 1.0220 break needed to confirm that. There is talk of large stops starting to build below 1.0200."

As seen by Valeria Bednarik, Chief Analyst at FXstreet.com, "support levels are seen at 1.0225 1.0190, and 1.0140, while resistance levels show at 1.0275 1.0310, and 1.0350.