The Australian dollar attempts again at falling 10SMA (0.7199) which capped Tuesday’s action, but was so far unable to break higher.
Near-term outlook remains mixed, following double-Doji (Mon/Tue) and strong downside rejection last Friday, as the action was contained by daily cloud, but recovery attempts so far lacked strength for stronger advance, as daily studies are weak.
The pair is looking for a catalyst to provide clearer direction signal, with Fed policy decision due later today, seen as key event.
Dovish tone from Fed would pressure the greenback and signal stronger recovery of the Aussie.
Initial bullish signal could be expected on sustained break above 10SMA, with further boost expected from lift above 100SMA (0.7218) and reversal signal on break and close above converged 20/30SMA’s (0.7240).
On the other side, sustained break below pivotal supports at 0.7167/63 (daily cloud base / Fibo 61.8% of 0.7020/0.7393) will be negative signal and could be sparked by hawkish steer from Fed.
Res: 0.7199, 0.7207, 0.7218, 0.7240
Sup: 0.7167, 0.7163, 0.7151, 0.7108
