BarroMetrics Views: AUDUSD – RBA Rate Cut 2013-09-03?
I trust my US readers are enjoying their Labour Day hols.
A quick one today…..
Tomorrow 14:30 AET, the RBA will announce its decision on rates.
I am going with consensus on this one. In my experience it has been rare for the RBA to have consecutive cuts. So, I’d expect tomorrow they will hold rates at current levels – at least for September. The AUDUSD has rallied off support at the 0.8900’s and is on track to for ‘E’ of the triangle. CD has been a a little deeper than I’d like. Let’s see if we can see ‘E’ form sometime this week.
But the continuation pattern is not the only pattern evident…. I do see a……
…..A possible H&S bottom forming on the 5-day swing (blue line in Figure 1) is still possible. For me, for the H&S to be triggered, I’d need to see acceptance above .9230.
So, to recap:
- The triangle continuation of the downtrend in the 5-day calls for a throwover above the trendline on a Fibo e.g. on Sept 4 (3 trading days after D); OR there will be an underthrow, – but even here, I’d expect to the AUDUSD reach the red dotted trendline.
- The H&S 5-d reversal calls for acceptance above .9230.
FIGURE 1 AUDUSD 5-day Swing