On Wednesday, AUD / USD is developing a downward trend, returning to last Friday’s levels and trying to hold below 0.7750.
The pair is under pressure from the strengthening of the dollar, caused by a new wave of growth in Treasury yields.
The results of the FOMC meeting will be announced today. It is unlikely that the regulator will take any steps to adjust the course of monetary policy, but at the press conference of Jerome Powell, there may be hints of a reduction in the asset purchase program due to high economic growth rates and heightened inflation expectations.
In addition, a block of rather weak economic reporting was released in Australia today. The first quarter consumer price index slowed down from 0.9% to 0.6%. The RBA core inflation index fell to 0.3%, which is worse than expected (0.5%). In annual terms, inflation rose from 0.9% to 1.1%, which is also below the expected value of 1.4%.
The Bollinger Bands indicator on the chart of the daily formation is still showing strong growth as the price range narrows.
The MACD indicator remains in the positive range, but begins to readjust to a decline and has already generated a weak sell signal.
Stochastic is growing uncertainly, approaching the 80% level.
After breaking down the key support at 0.7700, open sells with take profit at the next support – 0.7600. We place our stop loss at 0.7750.
A confident breakout and consolidation above 0.7770 will indicate a return to the upward trend. From here we enter long positions with the target at 0.7848. Set the stop loss at 0.7730.