AUD/USD drops back below 0.8100 ahead of busy day

• AUD/USD back into negative territory 
• Key events ahead: Australian inflation, US ADP private employment, and FOMC statement. 

The AUD/USD pair failed to hold on top of 0.8100 and dropped back into negative territory for the day. The slide from the highs took place amid a rally of the greenback and a decline in commodity and equity prices in Wall Street. 

Short-lived rebound 

On Asian hours AUD/USD bottomed at 0.8040 and then rebounded. It peaked at 0.8114, after the beginning of the American session. At the moment of writing it was trading at 0.8070, down 20 pips for the day. A consolidation below 0.8070 could increase the negative tone over the short-term. The next support is located at 0.8040 followed by 0.8015. 

If the aussie manages to rise and hold well above 0.8100, a test of 2018 highs at 0.8130/35 seems probable. Above the next resistance could be seen at 0.8160/65. 

“The pair´s short-term stance is neutral, as the price keeps hovering around a horizontal 20 SMA, not far from its multi-month high of 0.8135, and with technical indicators turning lower around their mid-lines. The AUD/USD pair needs now to break through 0.8135 to confirm additional gains ahead, aiming then to test the 0.8200 figure”, said Valeria Bednarik, Chief Analyst at FXStreet.

A busy day ahead

Wednesday is a busy day taking into account the economic calendar. In Australia, Q4 inflation data will be released (00:30 GMT) and around that time in the US, President Trump will deliver the State of the Union address. Later on Wednesday, the ADP private employment report is due and then the Federal Reserve will announce its decisions. Regarding the Fed, no change is expected and analysts will look into the statement for clues about the next steps. It will be the last meeting presided by Janet Yellen.