The AUDUSD at 0.67643 has been under significant strain near the level of 0.6800, with attention now turning to the testimonial of Fed Powell.

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• AUD/USD has faced immense pressure around 0.6800 as the focus shifts to Fed Powell’s testimony.

The pair currently trades last at 0.67643.

The previous day high was 0.6855 while the previous day low was 0.6753. The daily 38.2% Fib levels comes at 0.6792, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.6816, expected to provide resistance.

The AUD/USD pair has witnessed significant selling pressure after a short-lived pullback to near the round-level resistance of 0.6800 in the London session. The Aussie asset has dropped vertically to near 0.6760 as investors are worried ahead of the Federal Reserve (Fed) chair Jerome Powell’s testimony and Australia’s preliminary S&P PMI (June) data, which is scheduled for Thursday.

S&P500 futures have trimmed some losses posted in Asia, portraying a marginal recovery in the risk appetite of the market participants. The overall market mood is still cautious as a reiteration of hawkish guidance from Jerome Powell would stimulate fears of a recession in the United States.

The US Dollar Index (DXY) is facing barricades in extending its recovery above 102.65 as the street is divided about interest rate guidance. As per the CME Fedwatch tool, more than 50% chances are in favor of only one interest rate hike from the Fed by year-end. The US Treasury yields are showing a decent recovery. The yields offered on 10-year US Treasury bonds have jumped above 3.75%.

Meanwhile, new Fed nominees Governor Lisa Cook and vice chair Philip Jefferson have cleared their intentions that a slowdown in price pressures is their major focus so that the economy can return to sustainable growth.

The Australian Dollar has shown a bumpy ride as Reserve Bank of Australia (RBA) minutes turn out to be less hawkish than expected. RBA minutes indicate that policymakers were mixed about hiking interest rates further in June or its postponement to July. However, May’s Employment data released after RBA monetary policy has confirmed further policy-tightening.

Going forward, Aussie’s preliminary S&P PMI data (June) will be in focus. Manufacturing PMI is seen declining to 48.1 vs. the prior release of 48.4. Services PMI is expected to drop sharply to 50.1 against the former release of 52.1.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6769 at the time of writing. Pair opened at 0.6785 and is trading with a change of -0.24 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.667, 50 SMA 0.6679, 100 SMA @ 0.6723 and 200 SMA @ 0.6692.

The previous day high was 0.6855 while the previous day low was 0.6753. The daily 38.2% Fib levels comes at 0.6792, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.6816, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.674, 0.6696, 0.6638
• Pivot resistance is noted at 0.6842, 0.69, 0.6945

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