AUD/USD is rising after the RBA raised interest rates by 25 basis points in a move that was broadly expected, which takes the benchmark rate to 3.1%. The central bank signalled that more hikes were likely as it continues its fight against inflation, and now expects inflation to rise even further and economic growth to slow. Inflation is now expected to end the year at 8%, above the current level of 6.9%.
Looking ahead, Australian GDP data is due to be released and is expected to show that growth slowed slightly to 0.7% QoQ in Q3, down slightly from 0.9%, weighed down by an economic slowdown in China, its largest trading partner. A weaker-than-forecast print could weigh on the Aussie.
Where might the AUD/USD price head to?
After running into resistance at 0.6850, an almost 3-month high, AUD/USD tumbled lower, below the falling trendline to 0.6680 – the July low. Despite the fall lower, the uptrend could remain intact; the RSI is still in bullish territory. Buyers could look for a rise over the falling trendline at 0.68 to rise towards 0.6850 and create a higher high, exposing the 200 sma. On the downside, a move below 0.6850 opens the door to 0.6850 – the November 21 low. A move below here exposes the 50 sma at 0.6580.
BTC/USD steadies after US services PMI
BTC/USD appears to have recovered from a mid-November plunge after the implosion of FTX, with the focus back on the macro backdrop. BTC/USD is steadying around 17k after falling 1% following a hattrick of stronger than forecast US data. US NFP, ISM services PMI and factory orders topped expectations, raising questions over the extent to which the Federal Reserve will be able to slow the pace of rate hikes. If the US economy continues to power ahead, the Fed may need to raise rates higher than initially expected.
USD is recovering after falling to a 5-month low. 16.8K needs to hold to prevent a deeper selloff to 16k. Buyers could look for a rise over 17.4k to create a higher high.
USD/CAD rises to a weekly high
USD/CAD rises to a weekly high after stronger-than-expected ISM services PMI data boosted the USD. This comes hot on the heels of stronger US non-farm payrolls and a jump in factory orders. Meanwhile, recent data from Canada has also been strong, with Canadian GDP unexpectedly rising to 2.9% QoQ while 10.1k jobs were added. Today more Canadian data is in focus with the Canadian Ivey PMI, which is expected to surge to 61.3 in November from 50.1. This would add evidence to the view that the Canadian economy is showing resilience despite rising interest rates. The BoC is due to announce its rate decision tomorrow, and policymakers are caught between 25 and 50 basis points.
- Support could be seen at 1.35 (October low) and 1.3350 (November low).
- Resistance could be seen at 1.3659 (last week’s high) and 1.37 (round number).
