AUD/USD: steady on the 0.76 handle bid on yield spreads

AUD/USD has stabilized along the bottom of the 0.76 handle after a sell-off from the highs reached after some erratic trade post the RBA decision 

The RBA cut rates by 0.25bps due to a lack of inflationary pressures, taking the opportunity in a climate of lower house prices while the economy is only growing at a moderate pace. 

"The cash rate now stands at 1.5%.  There was no forward guidance and the monetary policy statement at the end of the week is now looked upon for fresh insight," explained analysts at Brown Brothers Harriman."  "On the face of it, the rate cut would appear to push the central bank back into a holding pattern, for what may be an extended period. The Australian dollar's gains may be being helped by flows in the bond market.  The 1.8% yield on the benchmark 10-year bond, a triple-A credit, may be drawing foreign interest.  A month ago it was yielding around 2%." 

AUD/USD levels

The upside targets 0.7675 recent high and the 78.6% retracement at 0.7688 which could prove to be strong resistance. To the downside, a break below 0.7600 would open territory back to the 20 sma at 0.7586 on the 1hr sticks ahead of the 200 sma at 0.7520 on the same time frame. 0.7480 marks the recent lows.