The Aussie has been on a sharp decline in recent times and it’s been putting up some excellent risk/reward opportunities. Even yesterday selling around the 0.7700 level looked pretty enticing although you would have needed to be quick to get a fill.

With the FOMC coming up, I am looking for more strength in the USD. That means the AUD/USD will likely continue to fall away. Identifying good places to short is crucial.

Trading Plan

If we could get back to 0.7700, I would be a keen seller. That might happen if there is no mention of a December rate rise. In that case, we would have a nice downside target of 0.7580.

If they do suggest a hike then we will take out the current support at 0.7626. If that becomes resistance then I would try and sell in that region on a pullback.

I feel the AUD/USD is a good trade because of the underlying weakness in the AUD. That might just give us a bit more downside potential than some of the other majors.

AUD/USD – 240 min Chart.