FxWirePro: AUD/USD comatose below 0.72 handle as RBA minutes offer no impetus, focus on Fed policy meeting

AUD/USD chart on Trading View used for analysis

• AUD/USD extends rangebound trade for the second straight session, remains capped below 0.72 handle.
   
• The Reserve Bank of Australia (RBA) meeting minutes offered little impetus and focus now on FOMC meeting due Wednesday for further direction.
   
• The (RBA) board agreed that the next move in the cash rate is more likely to be an increase but also believed there is no strong case for a near-term adjustment in monetary policy.
   
• Further, the risk-off action in the Asian equities dents the sentiment around the higher-yielding Aussie.
   
• AUD/USD is trading below 0.72 handle and the sell-off to levels below 0.71 if the Fed retains hawkish bias, squashing expectations of 2019 rate hike pause.
   
• The Fed funds rate futures also continued to price the chance of a rate hike this week around 75% with a March 2019 rate hike given a 30% chance.
   
• Technical bias for the pair remains bearish. Stochs and RSI supports downside. The pair is currently holding support at daily cloud and break below will see drag lower.
   
• Next major support on the downside below cloud lies at 78.6% Fib at 0.71. Further weakness on break below.
   
• 50-DMA is immediate resistance at 0.7195 and break above could see gains till 20-DMA at 0.7245.

Support levels - 0.7163 (61.8% Fib), 0.71 (78.6% Fib and psychological support)

Resistance levels - 0.7195 (50-DMA), 0.7245 (20-DMA)

Recommendation: Stay short on decisive break below daily cloud, SL: 0.7250, TP: 0.71/ 0.7085

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.