By Fast Brokers – The Aussie plowed through 5/28 highs and its psychological .85 level as the risk trade experienced a solid rally following a report from the UK’s budget office estimating a smaller than expected deficit. However, gains in the Aussie and other major dollar pairs were capped after news hit that Moody’s is downgrade Greece’s debt to junk. Although the downgrade had a negligible impact on the Euro, the news did sour enthusiasm generated by the new upward momentum in the risk trade. Meanwhile, investors are waiting on the release of the RBA’s meeting minutes from this month’s monetary policy decision. Investors will be looking to see how much the EU is weighing on the RBA’s approach towards setting interesting rates. Also, investors will be looking to see whether the RBA governors are positive on Australia’s economic state discounting negative developments in the EU. Australia’s positive employment data did come after the RBA’s rate decision, so investors could still favor the Aussie over the near-term. Meanwhile, although the Aussie does have some more room to the topside, the currency pair’s downtrend is still in play until there is a fundamental shift in sentiment.
Technically speaking, the Aussie faces technical barriers in the form of 6/14 and 5/18 highs. As for the downside, the Aussie has supports in the form of uptrend lines running from May lows along with 6/11 lows and the psychological .85 and .84 levels.
Price: .8575
Resistances: .8587, .8617, .8637, .8664, .8690, .8713, .8738
Supports: .8565, .8547, .8523, .8500, .8469, .8455, .8435
Psychological: .85
(click chart to enlarge)
Market Commentary provided by Fast Brokers.
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