Forex: AUD/USD suffers steep losses as choppy conditions continue

FXstreet.com (Barcelona) - The AUD/USD closed the day down 99 pips at 1.0279. It was a rough day for the majority of risk assets as market participants were not impressed by the latest ISM Manufacturing data out of the US, and the FOMC meeting failed to make a major difference. Later in the session we will see Building Permits (+1.3% estimates) out of Australia at 1:30GMT.

Price action on the charts remains extremely choppy with neither side being able to establish any type of follow through. According to Val Bednarik at FXStreet.com, “The AUD/USD trades near key 1.0260 support losing over 100 pips from the highs around 1.0370. The hourly chart shows indicators heading strongly south in oversold levels and after a limited upward correction, while 20 SMA heads strongly south above current price. In the 4 hours chart technical readings also signal a bearish continuation, with indicators crossing their midlines and price accelerating below 20 SMA."

She went on to add, “Failure to hold above 1.0300 has increased the bearish potential in the midterm, although steady losses below 1.0260 are now required to confirm a bearish continuation. Spikes up to 1.0335 should be understood as selling opportunities over the next sessions.”