Minutes from this month s Reserve Bank of Australia policy meeting

AUD/USD

Range: 0.9845 – 0.9956

Support: 0.9800

Resistance: 0.9945

Minutes from this month’s Reserve Bank of Australia policy meeting showed that policymakers felt that inflation would be contained within its range over the near term, with a stronger currency providing the necessary tight fiscal conditions, making a rate hike less likely. The Central bank said that the decision to remain on hold was “finely balanced”, adding that the likelihood of an increase in November was “pending evaluation” of the economy. The AUD spiked briefly, but the gains were short lived as traders put the probability of such an outcome at just 40%.

EUR/USD

Range: 1.3896 – 1.4005

Support: 1.3830

Resistance: 1.4000

EURUSD is now trading at around its daily lows around 1.3900. This was where it started during the Asian session, the pair then made a climb towards the 1.4000 zone. The pair rallied over 70 pips at the beginning of the Asian session and reached the highest price in 2 days at 1.4003, however the Euro failed again to extend gains above that level and retreated to the current price level. A close below 1.3820 or above 1.4007 could signal the direction of the currency pair over the coming days.

USD/CAD

Range: 1.0168 – 1.0201

Support: 1.0075

Resistance: 1.0230

Today is the Bank of Canada’s rate decision. Economists don’t expect a change, the market is still pricing in a 16% probability of a 25 bps hike. A hold is the most probable outcome, but it is the commentary that will really have the effect on the loonie. As a very hawkish or a very dovish tone will more than likely sway the pair one way or the other? The words of central banks are becoming an ever more prevalent issue in a very uncertain climate.

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