- The US dollar retreats after the Fed minutes.
- AUD / USD consolidates the recovery from 0.7460, still unable to recover 0.7500.
The AUD/USD it rose from 0.7485 to 0.7506 following the release of the FOMC minutes. A fall in the dollar propelled the pair erasing daily losses. It is still trading closer to the monthly low than it was to Tuesday’s high.
No big surprises from the Minutes
The Minutes showed that Fed officials believe the standard of “additional substantial progress” needed to tighten monetary policy has not yet been met. Several FOMC members mentioned that they expect the conditions to reduce the pace of asset purchases to be met sooner than expected.
The US dollar fell across the board after the minutes, erasing daily gains. The DXY turned negative, falling to the 92.50 area. US yields remain near daily lows. The 10-year term stands at 1.31%, on track to the lowest close since February 18.
Short term outlook
AUD / USD still has a bearish bias, priced well below the 20-day simple moving average (SMA). A recovery above 0.7540 would ease the pressure and above 0.7600 / 05 the Aussie will strengthen. The 20 and 200 day SMA converges at the 0.7560 area which will be a level to watch.
On the other hand, key support is at 0.7455. A consolidation below would clear the way for further losses, with the first target around 0.7400.
Technical levels
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