The dollar is gaining further as Treasury yields keep higher

10-year Treasury yields are nearly 10 bps higher currently, up to 1.74%, and that is continuing to push bids into the dollar in European morning trade.

In turn, that has seen AUD/USD erase its earlier advance in a fall from 0.7840 to 0.7800. So, let's take a look at how that is playing out on the charts:

AUD/USD H1 18-03

The topside move earlier briefly breached short-term resistance around 0.7838 before falling back now, putting some emphasis on support around 0.7792-00 (38.2 retracement level of the jump higher yesterday).

Buyers remain in near-term control as price action holds above both key hourly moving averages @ 0.7734-53. So, that region helps to define risk levels for buyers to try and continue to push the upside momentum in the pair.

The key risk though remains how things play out in Treasuries today as yields are climbing rather sharply and quickly in European trading so far.

The Fed continues to seem fine with a further steepening in the yield curve but I reckon they may not like seeing any potential dislocations in the market, though I would argue that what is going on today doesn't quite fall under that category yet.

As such, this will keep the post-Fed action more tight than what the initial knee-jerk reaction may suggest yesterday - at least until the weekend perhaps.