AUD/USD: consolidates between 0.7960 / 0.7891 awaiting key events

• AUD/USD supported on higher copper.
• AUD/USD drifts awaiting the RB and data in Asia tonight.

AUD/USD has been lifted by supply in the greenback as we progress through the US day. Currently, AUD/USD is trading at 0.7925, down -0.03% on the day, having posted a daily high at 0.7956 and low at 0.7891.

RBA in focus

AUD/USD has been supported on dips on the back of higher metal prices in London with LME copper +1%. However, the recovery attempts from 0.7891 were faded just below 0.7960 and the price has moved into a sideways consolidative drift ahead of key events this week. The RBA meets tonight and we also have the trade and retail numbers beforehand.  Markets will be watching for whether the RBA is concerned over the strength of the Aussie.

"We expect few surprises from the RBA: We see mostly the same themes as have been in place in recent times," explained analysts at Westpac, adding, "we see the front end out to the 3yr futures supported by the RBA, which will confirm its on hold stance at tomorrow's Board meeting. Even so, we see their comments around global growth, the AUD and Friday’s Statement on Monetary Policy (SoMP) as potentially market moving. Indeed we see the forecast updates in the SoMP as potentially the most important updates in some time from a signalling perspective." Meanwhile, the price is trapped between, 0.7960, Friday's NY afternoon high and 0.7891 as the 24-day low in Asia.

AUD/USD levels

Technicals lean bearish below 0.8000. The price is now below the 200-month SMA located around the midpoint of the 0.80 handle and pressure is building below there bringing in the January 9 and10 lows at 0.7809 into sight ahead of the 200 D SMA at 0.7739. However, monthly RSI remains with a bullish bias although the price is unable to find traction towards 0.81 handle.