Key Highlights
- The Aussie Dollar started a decent upward move from the 0.7144 low against the US Dollar.
- There was a break above a major bearish trend line with resistance at 0.7198 on the 4-hours chart of AUD/USD.
- The US S&P/Case-Shiller Home Price Indices increased 5.9%, less than the forecast of 6.2%.
- Today, the Fed interest rate decision is scheduled and the central bank is forecasted to increase rates from 2.0% to 2.25%.
AUDUSD Technical Analysis
The Aussie Dollar formed a good support base near the 0.7140-0.7150 zone against the US Dollar. The AUD/USD pair started an upward move and traded above the 0.7200 barrier.
Looking at the 4-hours chart, the pair climbed above the 0.7250 level and even traded above the 200 simple moving average (green, 4-hours). However, the upside move was capped by the 0.7300-0.7305 zone.
The pair started a downside correction and declined below 0.7265 and the 200 SMA. There was also a break below the 23.6% Fib retracement level of the last wave from the 0.7144 low to 0.7303 high.
On the downside, there is a strong support aligned near the 0.7220 level and the 50% Fib retracement level of the last wave from the 0.7144 low to 0.7303 high.
As long as the pair is above 0.7220 and 0.7200 levels, it could bounce back above the 0.7280 and 0.7300 levels. The next major resistance is near the 0.7330 level.
Other major pairs like EUR/USD remained supported above the 1.1720 level. GBP/USD is also trading nicely above the 1.3060 level.
Economic Releases to Watch Today
- US New Home Sales for August 2018 (MoM) – Forecast +0.5%, versus -1.7% previous.
- Fed Interest Rate Decision – Forecast 2.25%, versus 2.00% previous.
