The Australian dollar to US dollar exchange rate is currently at 0.64537 and is trading lower than 0.6500 due to concerns and hesitation prior to the release of the FOMC minutes.

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• AUD/USD trades below 0.6500 amid cautions ahead of the FOMC minutes.

The pair currently trades last at 0.64537.

The previous day high was 0.6522 while the previous day low was 0.6452. The daily 38.2% Fib levels comes at 0.6478, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.6495, expected to provide resistance.

The AUD/USD pair shifts its auction below the psychological support of 0.6500 in the early New York session. The Aussie asset faces immense selling pressure amid strength in the US Dollar due to America’s economic resilience and rising deflation risks in China due to poor demand.

S&P500 is expected to open on a mildly bearish note, following subdued cues from overnight futures. US equities are expected to face severe heat as Fitch warned downgrading of US banks including JP Morgan Chase. The US Dollar Index (DXY) continues to trade around 103.00 as investors await Federal Open Market Committee (FOMC) minutes for further guidance.

The release of the FOMC minutes will provide more clarity to investors about the interest rate guidance. Stickiness in the US core inflation and robust consumer spending momentum could force Federal Reserve (Fed) policymakers to consider one final interest rate hike. Also, Minneapolis Fed President Neel Kashkari said on Tuesday that more interest rate hikes are needed to rid of the ‘last mile’ in the journey towards achieving 2% inflation.

Meanwhile, the Australian Dollar is facing the wrath of the economic slowdown in China. Beijing’s new home prices fell in June for the first time this year, portraying a vulnerable realty outlook. Market sentiment also turned cautious after the Chinese government said it would no longer release monthly data about unemployment in young people, which had risen each month this year and reached 21.3 percent, NYT reported.

It is worth noting that Australia is the leading trading partner of China and a bleak economic outlook of China impacts the Australian Dollar.

This week, the Australian Dollar will show action after the release of the labor market report for July. According to the estimates, the Unemployment Rate is seen unchanged at 3.5% and fresh payroll additions were 15K, lower than the former release of 32.6K.

Technical Levels: Supports and Resistances

AUDUSD currently trading at 0.6443 at the time of writing. Pair opened at 0.6455 and is trading with a change of -0.19 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.6626, 50 SMA 0.6693, 100 SMA @ 0.6678 and 200 SMA @ 0.6737.

The previous day high was 0.6522 while the previous day low was 0.6452. The daily 38.2% Fib levels comes at 0.6478, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.6495, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.643, 0.6405, 0.6359
• Pivot resistance is noted at 0.6501, 0.6547, 0.6571

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