AUD/USD: Bid on Oil Draws Ahead of FOMC Minutes
AUD/USD is currently on the bid as we head in towards the FOMC today.
AUD/USD has rallied from a low of 0.7510 and has penetrated the 0.76 handle. This is a move that commenced in yesterday's start of business in the U.S. shift and completed today with demand coming in at roughly the same time as yesterday's major support and correction to the 0.7722 downtrend.
Notably, for today, the move comes around the positive outcome for oil traders with inventory draws in both yesterday's API and today's EIA, sending oil on an extension of yesterday's rally to meet the 200 sma on the 1hr at $37.38 WTI.
Meanwhile, overnight, the Reserve Bank of Australia's deputy governor was out on the wires overnight suggesting that a wide range of info points to low inflation for some time.
Karen Jone's, chief analyst at Commerzbank explained that AUD/USD has started to erode the accelerated uptrend at 0.7610. "This adds weight to the idea of a correction lower taking hold near term. As we highlighted last week, the recent high of 0.7722 had been accompanied by a divergence of the daily RSI." To the downside, she added, "Attention has reverted to support, namely 0.7477, last week's low, and 0.7416 (16th March low). The October and November highs lie at 0.7384/81."
(Market News Provided by FXstreet)