How Deep is the AUD / USD Drop After the RBA Policy Meeting Decision?

 The Reserve Bank of Australia (RBA) has maintained interest rates at 0.25% as expected at the latest October policy meeting.

The central bank will not raise interest rates until employment and inflation targets are reached and added, policy easing will be extended to support employment as the economy moves towards recovery.

The second Covid-19 wave that hit Victoria has caused a decline in Australian production rates and monetary and fiscal support is still needed for a longer period.

The unemployment rate is also expected to be at relatively high levels for a relatively long period in Australia.

On the chart for the AUD / USD pair, it can be seen that the temporary strengthening of the Australian dollar following the results of the meeting was published before the price plunged back.

The price soared above the 0.72000 level testing the resistance level before making a move below the Moving Average 50 (MA50) support level on the 1 hour price movement.

A drop below that level has given early indications for a bearish price trend change.

However, it is likely that the decline in prices will be hampered by the impact of the depreciation of the US dollar in market sentiment indicating a recovery.

If the decline continues, the focus level is seen on the RBS zone (resistance become support) at 0.70800 before the price leads to the 0.70000 support zone.

However, if the price returns to the upside, the resistance level of 0.72000 will be tested again before a higher rise will be displayed with a bullish trend change on the AUD / USD chart.