AUD/USD drops modestly after FOMC decision

The US dollar gained momentum across the board and trimmed losses after the Federal Reserve, as expected, left interest rates unchanged. AUD/USD moved away from daily highs and dropped to 0.7655. 

Earlier today the pair rallied from 0.7610 to 0.7677. Currently is trading at 0.7657, slightly above the 20-hour moving average and marginally on top of yesterday’s closing price. 

The Federal Reserve left interest rates on hold and continued to signal that the case for a rate hike has “continued to strengthen”. Two members voted for an immediate rate rise, instead of three, like the September meeting (E. Rosengren reversed its vote). 

The outcome of the meeting was in line with expectation and so far the market impact has been limited. Equity prices remain around the same level it had before the release of the statement while the US dollar has risen modestly (still remains lower for the day). 

Technical levels 

To the upside, resistance levels might lie at 0.7677 (daily high), 0.7700 (psychological) and 0.7730/35 (Oct high). On the opposite direction, support could be located at 0.76555 (American session low), 0.7620 (20-day moving average) and 0.7595 (Oct 1 low). 

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