AUD/USD: Close above 0.6835 would suggest a target of 0.69 – CitiBank

Analysts at Citibank no longer expect the Reserve Bank of Australia (RBA) to introduce a QE program next year and keep their forecast for one further 25bp rate cut to 0.50% in February. According to them, the mentioned forecast may improve the sentiment of the Australian dollar. 

Key Quotes:

“We do in fact expect another cut (Feb 2020) from the RBA this cycle; and Governor Lowe has certainly left the door open to further cuts as the central bank is “prepared to ease monetary policy further if needed”. So perhaps this is just recognising the inevitable. A lot of dovishness is priced in Aussie already. In terms of short term drivers: Aussie likely also trades up with the wave of trade détente.”

“The 0.6770 support range is a key level to watch. We are also seeing a double bottom set-up forming on the daily chart and a close above the neckline at 0.6835 would suggest a target of 0.69 with next support at 0.6671.”