September 21, 2022 12:03 AM ET
By: AnalysisWatch
AUD/USD extended losses from the previous day's Fed meeting as it breached a one-year low of 0.6670 during Wednesday morning's session in Europe.
In doing so, the AUD/USD pair not only extends the previous day's reversal from the 10-DMA but also cheers a clear break to the downside of the mid-July rising support line, which is now resistance around 0.6710.
Contributing to the strength of the bearish bias are the declining RSI and MACD indicators, as well as the four-month-old downtrend channel formation.
Still, the quote is on track to test the support line of that channel at around 0.6560. However, the round number of 0.6600 may offer a temporary stop during the decline.
The 61.8% Fibonacci expansion (FE) of the April-August moves, near 0.6535, also acts as a filter to the downside.
In the meantime, recovery moves need to not only clear the support and resistance lines around 0.6710 but also remain more firmly above the 10-DMA, near 0.6745, to convince buyers.
Overall, AUD/USD is in the bearish crosshairs ahead of the key Federal Open Market Committee (FOMC) meeting.
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