AUD/USD drops toward 0.80 post-FOMC statement, Yellen eyed

The AUD/USD pair dropped more than 50 pips in a matter of minutes after the FOMC released its monetary policy statement and updated economic projections following a 2-day meeting. As of writing, the AUD/USD was trading at 0.8030, still up 0.25% on the day.

The Federal Reserve's statement showed that 11 of the 16 policymakers were expecting another rate hike in 2017 compared to only 8 members in June. The statement also revealed that the Fed would start shrinking its balance sheet in October and the Committee was expecting a temporary rise in inflation in the aftermath of hurricanes. With the initial market reactions, the US Dollar Index quickly jumped to a fresh daily high at 92.03 and was last seen at 91.95, gaining 0.35% on the day.

• FOMC's decisions regarding monetary policy implementation - Sep 20, 2017
• FOMC statements: Comparison between July and September
• FOMC's updated economic projections - Sep 20, 2017

Now investors turn their attention to Chairwoman Janet Yellen's press conference. In case Yellen adopts a hawkish tone in her speech, the USD rally could extend and continue to weigh on the AUD/USD pair.

• Janet Yellen Speech - Fed Live Stream

Technical levels to consider:

The pair could encounter the first technical support at 0.8000 (psychological level/daily low) ahead of 0.7950 (50-DMA) and 0.7870 (Aug. 31 low). On the upside, resistances could be seen at 0.8090 (daily high), 0.8125 (Sep. 8 high) and 0.8200 (psychological level).