AUD/USD steady in the 0.7150’s however could slide towards 0.7100

• The Aussie finishes on the wrong foot in the American session, down 1.14%.
• The US dollar up  0.42%, posted a fresh nine-month high.
• Risk-off market sentiment, undermine risky assets like the AUD.

The AUD/USD maintained its offered tone through the end of the American session, trading around 0.7150 a loss of 1.14%. Despite the US 10-year Treasury yields falling to 1.245%, the US dollar was up in the day, with the DXY trading around 93.56 for a 0.42% gain. 

The US dollar strength is a continuation of the market’s reaction to the FOMC Minutes, which expects the possibility of bond tapering later in this year.  It is important to note that few officials noted that a possible adjustment of slowing the pace of bond purchases, however, could not be soon.

In regards to market sentiment, we are still in a risk-off environment with of the Dow Jones closing in the red, while the S&P 500 and the Nasdaq posted reduced gains of 0.1% each.

Later in the day, RBA Kent will speak at 23:05 GMT at an FX Market conference.

AUD/USD technical outlook

The AUD/USD is at 0.7149 and headed lower. The daily moving averages are above 0.7400 with the shorter time-frame under the longer time-frame and with a falling slope. The downtrend is gaining traction. The pair tested October 28, 20 high at 0.7157 and bounced back above 0.7170. However, the fresh low of the year is 0.7143. On its way down, the next support is 0.7100 then November 2 low at 0.6996.

RSI is 27.69 in oversold levels, while the Average True Range is 57 pips and leaning upwards.