RBA Hawks may have Long Hop in store
The Reserve Bank of Australia’s Governor Stevens has created quite a conundrum ahead of its rates decision Tuesday, in Asia-Pacific trading hours, 1430 AEST/0400 GMT
He was very hawkish over the weekend.
And AUD/USD twice tried 1.10 Monday in Europe, but failed. Also, RBC Capital Markets says only 1/22 analysts it polled see a hike, “and no hike is even remotely priced in.” It says the nearest support was observed at 1.0925, with trailing stops seen near 1.0915/20.
In the event of a sell-off, strategists of one of the Big 5 say they’re looking to buy dips toward 1.0900. “Below here, our orderbook is stacked with bids down to, and below the important 1.0600 pivot.”
With the pair currently down a few ticks from the current session high which was 1.095000, the market seems in no major hurry to take RBA’s threats seriously just yet, but still seems poised for any relative ‘surprise’