AUD/USD runs up to test the 200-hour moving average
Price is creeping higher after a hint of a double-bottom close to 0.6840 as buyers make an attempt to challenge the 200-hour MA (blue line) once again.
Since breaking below the key level, buyers have tried to wrestle back some near-term control three times already since yesterday but have failed at each run. As such, the risk now is that a failed move may lead to a firm break below 0.6840 (overnight low @ 0.6838).
Meanwhile, for sellers, the first line of defense will be the 200-hour MA @ 0.6858 - currently being tested - before the 100-hour MA (red line) @ 0.6879 comes into play.
For now, they are still in near-term control and the onus is upon buyers to try and get some momentum going back to the upside.
Otherwise, there is good reason to expect the pair to possibly run lower in the next few months as the RBA may be forced into another rate cut in February next year.
Currently, cash rate futures have only priced in a 59.2% probability of that happening.
In terms of what may move that pricing, be wary of the latest Australian labour market report release tomorrow. A poor reading there will help to reaffirm the recent downside bias against the domestic economy.
That in turn will weigh on the aussie further as we look towards the February RBA meeting.
