Archived IMT (2009.04.06)

While sell-off in stocks is being attributed to a banking analysts highlighting of the ongoing dangers in the banking sector, markets needed little catalyst for a pullback after nearing key threshold (860-865 upside in S&P500). This was the equivalent of $1.50 in GBPUSD, 121.60 in USDJPY and 0.72 in the Aussie-- all key resistance levels. Watch for the RBA decision at 4.30 am GMT, which we expect to keep rates unchanged at 3.25%. Such a scenario would be a positive for the Aussie across the board but if Asian stocks are come under pressure following a negative US session, then Aussie losses may intensify. A 25-bp rate cut is delivered could magnify such selling.0.7020 target stands next.