- AUD/USD lacks a firm intraday directional trend on Wednesday and is range bound.
- The dollar’s selling trend offers some support, although a softer risk tone limits gains.
- Mixed US data does not provide any impetus as the focus is on the FOMC minutes.
The AUD/USD pair is struggling to gain significant traction and is bouncing between tepid gains and small losses during the early American session on Wednesday. The pair currently sits around 0.6650, almost unchanged on the day, as traders eagerly await the release of the November FOMC Meeting Minutes.
Meanwhile, the US dollar selling trend continues to offer support for the AUD/USD pair. Investors seem convinced that the Federal Reserve will slow the pace of its tightening cycle and have been pricing in the possibility of a relatively minor rate hike of 50 basis points in December. This, in turn, is seen as a key factor weighing on the dollar.
The dollar maintains its offered tone and fails to get any respite from the mixed US economic releases. Weekly US jobless claims rose to the highest level since August, largely offsetting upbeat US durable goods orders data. That said, cautious markets are helping cap losses for the safe-haven dollar and keeps the risk-sensitive Australian dollar capped.
From a technical point of view, the AUD/USD pair has managed to stay comfortably above the round 0.6600 level. Such an area should protect the immediate fall and act as a pivot point for intraday traders. A convincing break below will expose a strong breakout point of resistance, around the 0.6560-0.6550 zone, which coincides with the 200 EMA on the 4-hour chart.
A follow-up selling will nullify any short-term positive outlook and shift the bias in favor of the bears. The AUD/USD pair could then become vulnerable and accelerate the decline to the key psychological 0.6500 level. The downside trajectory could extend towards the 0.6435 intermediate support before spot prices end up falling below 0.6400 levels.
On the other hand, immediate resistance lies before 0.6700, which if conquered should pave the way for further gains. The AUD/USD pair could then rally to the 0.6740-0.6745 barrier and make another attempt to conquer the 0.6800 level. Momentum could extend towards the technically significant 200-day SMA, currently around the 0.6845 zone.
AUD/USD 4-hour chart
Key levels to watch
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
