Remember: RBA rate decision in less than 6 hour | Forexlive

The Reserve Bank of Australia will announce their February decision at 10:30 PM ET with the expectations of a 25 basis point hike. That would take the cash rate to 3.35% from 3.10%.

Recall that the fourth quarter CPI data came in much stronger than expected at 1.9% a few weeks back. That should keep the Reserve Bank of Australia in play. Traders will also be monitoring for any clues to forward guidance. Currently market expectations are for another 25 basis point hike when the central bank meets again in March.

The AUD over the last few days has been following the US dollar higher (sending the AUDUSD lower). Today the price traded to the lowest level going back to January 6.

In the process, the price moved below a swing area on the hourly chart between 0.6869 and 0.6893 (see red circles). The price also fell below the 50% midpoint of the trading range since the December 21 low. That level comes in at 0.68926. The current price trades at 0.6882, in between the swing area extremes. The corrective high off of the low today, stalled near the 50 percent midpoint level keeping the price on the lower half of the most recent trading range.

The 50% at 0.68926 will be the bias defining level through the rate decision. If the RBA is more hawkish, and the market interprets that as bullish for the AUDUSD, the upside target would look toward 0.6928 followed by 0.6955 (the broken 38.2% retracement). Above that level and it opens the door for a retest of another swing area between 0.6982 and 0.6997.

On the downside, the key targets include the 61.8% retracement of the move up from the December 21 low at 0.6830. Move below that level and the te 200 day moving average currently at 0.6810 would be eyed. The price is not traded below its 200 day moving average since January 6.