The pair is down 0.4% to 0.6340 on the day and testing the lower boundaries set out since August trading just under 0.6360 currently. Price action has been caught in a ping pong range for the most part but with the dollar also running rampant amid higher yields, sellers look to be taking the initiative to drive AUD/USD lower at the moment.
A firm break below the September low of around 0.6330 will likely set off the next downside leg towards 0.6200, considering the lack of technical support.
Higher Treasury yields is still the name of the game in the big picture and until that changes, the path of least resistance seems to favour a move lower in AUD/USD - especially with the RBA standing pat as they did today.
The Australian central bank offered nothing new and remains on the sidelines, although in all likelihood they might just be done with rate hikes already. And at best, they still have one more to go.
But even so, that doesn't change the fact that rate differentials continue to favour the dollar and what more with the balance of risk sentiment also looking rather shaky as higher yields are rocking the boat in the equities space.
