AUD/USD – Choppy Trade Between 0.55-0.59 to Continue

The Australian Dollar had a volatile trading session yesterday plunging in Sydney following the RBA’s rate cut and QE decision to 2002 lows at 0.55506 before jumping to 0.5962, settling in late New York at 0.5772. Already this morning, the fall in US stock futures has seen AUD/USD slip to 0.5685.

AUDUSD Chart - Trading View - 20 MARCH 2020
AUDUSD Chart – Trading View – 20 MARCH 2020

Yesterday Australian Employment data beat forecasts in both the Jobs gain and Unemployment rate. Markets shrugged this off as RBA Governor Philip Lowe told a press conference that Australia should anticipate “significant” job losses. Lowe also clarified that he doesn’t think the RBA’s plan to buy government bonds in the secondary market quite meets the standard of quantitative easing. US economic data were dismal. The key US 10-year rate is at 1.14%. Australian 10-year bonds yielded 1.41%. Australian 10-year rates are now higher than that in the US. This cannot be ignored.

Meantime the Covid-19 death toll continues to rise which is grim news for all, including the markets.
Expect further choppy trading today between 0.5500 and 0.5900. Immediate support is found at 0.5650 followed by 0.5610. Immediate resistance lies at 0.5720 followed by 0.5790.
We may have seen a short-term base at 0.55 cents. Tin helmets on, lets get ready to rumble.

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