Investors are taking into account the hawkish interest rate policy from Wednesday, causing #AUDUSD @ 0.67702 to steadily move towards the 0.6800 mark.

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• AUD/USD is marching towards 0.6800 as investors have digested the hawkish interest rate policy on Wednesday.

The pair currently trades last at 0.67702.

The previous day high was 0.6756 while the previous day low was 0.6715. The daily 38.2% Fib levels comes at 0.674, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6731, expected to provide support.

The AUD/USD pair has sensed mild selling pressure after printing a fresh day high at 0.6778 in the European session. The Aussie asset is broadly approaching the round-level resistance of 0.6800 as headlines of fresh stimulus announcement in China has infused optimism in antipodean.

S&P500 futures have added some gains in the London session, portraying further recovery in the risk appetite of the market participants. US equities found decent demand on Monday as investors are clear that the Federal Reserve (Fed) will raise interest rates further by 25 basis points (bps) to 5.25-5.50%.

The US Dollar Index (DXY) has climbed above the immediate resistance of 101.40 and is looking for fresh bids for further upside. Strength in the USD Index is coming from anxiety among market participants ahead of the interest rate decision by the Fed. The Fed is expected to raise interest rates further but the factor that is making investors uneasy is the guidance to be delivered by Fed Chair Jerome Powell.

Investors will focus on whether Jerome Powell would reiterate the need for one more interest rate hike after July’s interest-rate policy. The economic indicator that could propel Jerome Powell to deliver hawkish guidance is the tight labor market conditions.

Meanwhile, the Australian Dollar has got strength after the announcement of stimulus in China. State news agency Xinhua cited the Politburo – the top decision-making body of the ruling Communist Party – saying that China will step up economic policy adjustments, focusing on expanding domestic demand, boosting confidence, and preventing risks.

It is worth noting that Australia is the leading trading partner of China and stimulus support in China would strengthen the Australian Dollar.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6765 at the time of writing. Pair opened at 0.6739 and is trading with a change of 0.39 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 0.6721, 50 SMA 0.6692, 100 SMA @ 0.6687 and 200 SMA @ 0.672.

The previous day high was 0.6756 while the previous day low was 0.6715. The daily 38.2% Fib levels comes at 0.674, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6731, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.6718, 0.6696, 0.6676
• Pivot resistance is noted at 0.6759, 0.6778, 0.68

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