News Commentary
Uncertainty remained after White House economic adviser Larry Kudlow told Fox Business Network later on Wednesday that Trump’s announced plan did not indicate a softened stance on China.
However, there are still tit-for-tat battles which are affecting the markets.
The Reserve Bank of New Zealand (RBNZ) maintained the Official Cash Rate (OCR) at 1.75%and has been forecasting no changes until late next year.
According to Governor Adrian Orr, inflation is likely to increase in the near term due to higher fuel prices. Beyond that, it is expected to gradually rise to the 2% annual target, resulting from capacity pressures.
The Bank of Canada Governor, Stephen Poloz, stated that the impact of the US trade fight and tighter mortgage rules will “figure prominently” in the Central Bank’s July’s interest rate decision.
He also approved market reactions to May data, flagging the hanging situation on NAFTA, but also kept an optimistic sentiment.
Chart Analysis
AUD/USD
On the daily chart, the price has reached the support zone of 0.7325-0.7365.
The pair is supposed to find some breath powered by divergence on RSI to reach the key resistance of 0.7515, where the descending trend from the high of February is located.
USD/CAD
As we expected before, the price has reached the key resistance level of 1.334.
As we can see, the price has reversed from a very strong selling area according to many factors, including key resistance level, 78.6% Fibonacci, the upper level of the reversal wedge, forming the Gartley harmonic pattern, and overbought in RSI.
So, any bounce there will lead the price down to the support zone at 1.309-1.299.
As we expected before, the price has reached the support zone 81.2-80.5 as the price is moving sideways.
So, the price is expected to retest the head of the pattern to again reach the levels 84-84.4.
