AUD/USD analysis: Aussie down, following equities' moves

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7248

AUD/USD breaks support but no follow-through ahead of Fed's meeting.
Gold's reaction to Fed's decision could set the tone for the Aussie through the rest of the week.

The AUD/USD pair edged marginally lower Tuesday, despite a better market mood that saw equities recover some ground. A scarce macroeconomic calendar through the first session of the day played against the Aussie which broke below the 0.7255 support against the greenback and was unable to regain it despite multiple intraday attempts. The American currency remained out of market's favor, probably the main reason why the pair didn't extend its intraday decline. The AUD couldn't take many clues from commodities prices, as base metals were also confined to tight intraday ranges, as most market participants, particularly speculative ones, are waiting for the Fed's monetary policy outcome before taking positions. Anyway, the calendar will remain thin during today's Asian session with only data coming from New Zealand, which usually have a limited effect on its larger counterpart.

The pair hovers near daily highs heading into the Asian opening, with an increasingly bearish stance according to the 4 hours chart, as its currently resting above a bearish 200 SMA and below the 20 SMA, also below the 61.8% retracement of the latest daily decline. Technical indicators gain downward strength below their midlines, reaching fresh weekly lows, although the pair would need to extend its decline below the 50% retracement of the same decline, in the 0.7220 area, to be able to extend its negative momentum that will anyway will depend on how the market reads the US Fed's meeting outcome. The pair could regain some upward poise on a firmer recovery above the 0.7260 level.

Support levels: 0.7220 0.7190 0.7155

Resistance levels: 0.7260 0.7300 0.7335

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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