AUD/USD – offered on upticks, breaches 0.76 support

Minor uptick in AUD/USD to 0.7626 was met with fresh offers following which the spot breached 0.76 handle as Treasury yields in the US strengthened.

USD gains as T-yields rise

Short duration treasury yields in the US spiked in Asia, thus lending support to the US dollar. The 2-yr yield, which mimics short-term rate hike/inflation bets, advanced 2.4 basis points to 0.77%.

The action in early Asia suggests markets expect Yellen to talk up rate hike bets during her scheduled speech at Jackson Hole later this year. At the time of writing, the spot was trading just below 0.7590 levels.

AUD/USD Technical Levels

Breach of support at 0.7571 (61.8% of 0.7835-0.7145) would open doors for a drop to 0.7490 (50% of 0.7835-0.7145). A violation there could yield 0.7450 (38.2% of 0.6827-0.7835). On the other hand, a break above 0.7626 (daily high) would expose 0.7691 (previous day’s high), above which the spot could target 0.7760 (Aug 11 high).