The pair has already been under pressure as of late, with the dollar contesting key technical levels on multiple charts - this included. The key trendline support (white line) and the 14 July low around the region of 0.6678-81 is helping to hold losses for now, though we are seeing sellers test the waters with the low today hitting 0.6667 - its lowest since June 2020.
As much as sellers are looking to make a play, any firm break will need confirmation from the Fed later today. That remains the key driver of trading sentiment at the moment. With the dollar side of the equation in focus, it will require a hawkish push from the Fed to really signal a break lower in AUD/USD towards 0.6500 next.
Another negative factor for the pair is that the aussie side of the equation isn't too comforting, with risk tones under pressure and also the fact that the Chinese yuan is sliding further. USD/CNY has now firmly breached 7.00 and is looking for a further break to the topside:
That will keep added pressure on the antipodeans while also providing a tailwind for the greenback. But again, the Fed will determine the next steps even on this front so keep your eyes and ears peeled for the market reaction later in the day.
