Audusd Down As Traders Await Rba

Audusd Down As Traders Await Rba by Adam Rosen last updated on February 12, 2024

Aud/Usd Down By 0.90% As Traders Await Rba Decision

better-than-expected NFP report is making waves across the FX pairs. That's why even the AUD/USD dropped by 0.90% during Friday's session, as the report showed the US labour market is still very resilient.

For now, the AUD/USD is trading near 0.6511 with a downward bias as the odds of a rate cut during March have plunged to new lows. March's rate cut is entirely out of the equation now.

10-Y Bond Yields Touched 4.06%

However, the NFP report is more than just bugging the AUD bulls. The 10-year bond yields reached highs near 4.06%, while they were near 3.90% before the NFP. Overall, a 15 bps jump was seen in the yield of the 10-year US government bonds.

Similarly, the DXY, which measures the greenback's performance against other currencies, also touched 104.4, a 7-week high!

Other data showed a healthy jump in the newly manufactured goods. At the same time, UM's consumer sentiment also jumped to 79.1, which indicates that the economy remains strong despite the high-interest rates.

For the week ahead, the critical event for the AUD/USD is the policy decision from the RBA, along with the press conference of the RBA governor. Once these events are over, the focus will shift toward the NAB confidence data, Consumer Confidence (Westpac), and the industry index from the AI group.

Technical experts also highlight that when AUD/USD dived under the 200 SMA on the D1 chart, the outlook shifted towards 'natural to bearish.'

If the AUD/USD can manage a daily close under 0.6527, it will open the doors to the 0.6500 handle. Conversely, a bullish target can be 0.6550 if the Aussie bulls conquer the 100 SMA (D1).

Despite all this, the critical event that's now closely watched is how the RBA approaches the interest rate decision.