AUD/USD bulls are dancing on the RBA's bullishness

FXStreet (Guatemala) - AUD/USD bulls are dancing on the RBA's bullishness and has scored R2 as US traders continue to back the commodity currency.

But for how long can the economy's job market continue to improve when the likes of economies in their biggest trading partners, such as China, have been forecasted to slow even further by the IMF? Nevertheless, the RBA left rates on hold for a 5th month at 2% and remain optimistic.

But...?

But what about a scenario where the Fed will not cut rates and investors start to move away from the greenback again, propelling the Aussie forward even further and dangerously towards uncomfortable areas for the RBA where the price will no longer be supportive to the economy's growth?

The RBA's danger zone is above 0.7500, so we are some way off although it wasn't too many months ago that we were trading there. The 200 DMA stands at 0.7619 today as a reference point.

For the mean time, the RBA are quite happy at these levels of growth but moving into 2016 may be another matter should housing deteriorate and the services sector is impacted by a higher Aussie.

New opportunities for Australia's economy ahead

The unemployment rate will still be key moving forward and other global developments, perhaps such as the latest news of the Trans-Pacific Partnership trade deal moving towards a deal, where Australia’s prime minister, Malcolm Turnbull, said it offers “unprecedented new opportunities” for new markets in Asia and Latin America, while Australia has faced the end of its mining boom and China's growth is downgraded yet again by the IMF as follows:

Cuts 2015 global growth to 3.1% vs 3.3% prior
2016 3.6% vs 3.8% prior
China unch 6.8% 2015, unch 6.3% 2016
And...

China growth slowdown fall out bigger than expected
Fed should await firmer signs of inflation rising before liftoff

AUD/USD bullish - (High so far is 0.7150 and spot 0.7150 R2 at time of writing)

Technically, the price took-off from the 4hr 200 SMA and today's pivot at 0.7080 last night and popped through the 0.71 handle on the release of the RBA decision and bullish statement.

We hit a roadblock at 0.7120/25 as the RBA call was widely expected finding some offers on the fade to the 20 SMA on the hourly chart that was lending support at 0.71 the figure, stabilizing in European trade and was then picked up by Londoners and the US market to current highs at R2. The RSI (14) on the hourly is at 68 and warns of oversold territory ahead.
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