AUD/USD Slammed to 0.7600 Mark on Weak Australian CPI Data
pair witnessed a sharp fall on Wednesday, dropping to 0.7600 round
figure mark, as Australian core CPI fell to its lowest level since 1999.
Surprise drop in CPI fuels rate cut speculation
The official data released today showed headline inflation falling by 0.2% for the March quarter. Compounded with the ongoing concerns over Chinese economic slowdown, the unexpected fall in CPI is now fueling speculations of a rate cut by the Reserve Bank of Australia. With talks of a Fed rate-hike remains high on the agenda, RBA rate cut speculations might continue exerting pressure on the pair in the near-term.
Today's fall has dragged the pair well below its 20-day SMA support and the pair has failed to register even a minor recovery from lower levels. With hourly RSI dropping to near-term oversold conditions, the pair might consolidate near 0.7600 before it resumes its near-term downward trajectory.
Technical levels to watch
A sustained weakness below 0.7600 mark, the pair clearly seems to be headed towards its next major support near 0.7540 area before dropping to test 50-day SMA support, currently near 0.7515-0.7500 round figure mark.
On the upside, attempts of recovery might now confront immediate resistance near 0.7625-30 area and any further up-move now seems to be capped at 0.7650 strong horizontal resistance.