The Reserve Bank of Australia has done the expected and cut interest rates to a new record low at 0.1%. The markets responded negatively with the AUD/USD dropping to a low of 0.7035. However much of the downside had been factored in since Friday and therefor has not startled the pair too much as the bulls hold strong around these levels.
With the US election coming to an end, President Trump closes in on Democratic candidate Joe Biden. In all six of the swing states Biden hold 50% of the votes to Trump’s 46%. In the last election these states proved to be vital for Trump. He had won in all six taking victory over Hilary and giving the Republicans a majority at 53-47 seats. But as the minutes draw closer so do the numbers. With Trump’s clan declaring election fraud and Biden claiming the race is over and the victory to be his who know what this circus will have installed for us next. One thing is for sure, the show won’t end for days to come.
Back to the Aussie as it trades closer to critical resistance, technically the Aussie looks weak. As it continues to hover around the psychological number of 0.7000, a break below this could see the bears rush in for a feast. Look to wait for a break at 0.7065 for confirmation. Should this support be broken consider a target of 0.6957 followed by 0.6925.
On the upside, a break above 0.7071 could see a short rally to 0.7112 and then 0.71183.
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