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AUD/USD drops back to 0.7130, eyes on Fed minutes, Australian jobs

2018-10-17 18:31:44Market Analysis
AUD/USD drops back to 0.7130, eyes on Fed minutes, Australian jobs

The bears continue to guard the 0.7150 barrier in Asia this Wednesday, knocking-off the AUD/USD pair to fresh session lows of 0.7130, as markets remain cautious heading into the key FOMC September meeting minutes release and Thursday´s Aussie jobs data.


The renewed weakness in the Aussie is largely on the back of a fresh bout of buying seen around the greenback versus its main competitors, as the buck tracks the Treasury yields higher amid a risk-friendly marker environment. The US dollar stood resilient to the latest US President Trump´s remarks on the Fed´s tightening policy, as stronger US fundamentals and a solid performance on the Wall Street underpinned the sentiment.


Meanwhile, the Aussie was also weighed down by the comments from the RBA Assistant Governor Debelle, as he talked down the local currency while noting that the wages may not increase until unemployment falls further.


All eyes now remain on the Fed´s monetary policy meeting minutes due at 1800 GMT, which “are likely to reaffirm the Fed's longstanding call of gradualism in policy tightening, and may offer insights on the neutral interest rate level (neither expansionary not contractionary) and whether most policymakers are willing to push rates above that level”, FXStreet´s Analyst, Omkar Godbole, explains.


AUD/USD Technical levels


According to FXStreet´s Chief Analyst, Valeria Bednarik, “The 4 hours chart for the pair shows that a bullish 20 SMA has been leading the way higher, but also that sellers have capped the intraday advance around a bearish 100 SMA. Technical indicators in the mentioned chart have bounced from their midlines, maintaining upward slides but below their previous weekly highs, indicating buyers are still cautious. Today's data could be a make it or break it for the pair, with a bullish continuation expected on a run through 0.7160, the 61.8% retracement of the latest daily slump. Support levels: 0.7110 0.7085 0.7040. Resistance levels: 0.7160 0.7195 0.7220.”