The Australian dollar is having a relatively quiet day with not much data up on the table to propel it again beyond 77 cents.
“The RBA minutes to be released today are unlikely to provide any shocks,” according to Greg McKenna, chief market strategist at CFD and forex provider AxiTrader.
“The governor and the bank have already had multiple opportunities this month to give the market their view on the economy and its outlook,” he added.
So with the minutes unlikely to be a catalyst for a run above 77 cents, traders are wondering what’s next for the Aussie.
In the meantime, McKenna said the Aussie remains trapped in a broadish 0.7580/0.7720 range.
“I say that because presently it feels like all the good news might be baked into the cake,” he said.
“Much of the good news is already priced in with regard to expectations about the reflating global economy, higher stock prices, and more recently a strong signal from the RBA that it is not of a mind to drop rates,” he said.
As it stands, the Aussie’s run has failed at the moment with 77 cents again proving a bridge too far for the bulls.
With the bulls’ exhaustion and not much data to surprise the market, the Australian dollar rally is at a standstill.
However, March 1 could be a big day for Aussie traders, according to McKenna. This is because the partial indicators of Q4 GDP will be released on that day. And if the Australian government were to be believed, is likely to hold water this time.
Additionally, private new capital expenditure data will be released on Thursday. Until then, traders are a little reluctant to push too hard just yet.
On the other hand, it is also worth noting how the Aussie dollar has outperformed the US dollar since the beginning of 2017.
The US dollar, in index terms, is just 1.66% weaker from its 2017 high. The AUDUSD, on the other hand, has rallied 7.42% and is sitting at 0.7681 this morning, said McKenna.
“That suggests the next big drivers of the Aussie are movements in the US dollar and the release of partial indicators, and then GDP itself,” McKenna said.
“Those events could shake the Aussie dollar from its relative slumber,” McKenna added.
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