Last week’s US drop in inflation release has put the US Dollar (USD) on notice. Markets are now focusing on clues as to when the Federal Reserve might “cut” rates. Up until recently the rhetoric was “high for long”. Prices Monday in the cross extended Friday’s close around 0.6500 reaching 0.6560 this morning looking like we may see the highest daily close in the pair since 8 August earlier this year. Key Fib levels suggest the pair could get strong resistance around 0.6600 – the 50% zone of the low of 0.6300 and high at 0.6900 in July. In the meantime, RBA minutes later today should confirm further tightening of policy may be required to bring inflation under control, data dependent with evolving risks.
Current Level: 0.6560
Support: 0.6300
Resistance: 0.6800
Last week’s range: 0.6348 – 0.6542