AUD/USD breaks below 0.7600 and approaches last week lows

• Stronger US Dollar pushes AUD/USD to 0.7560, 2-day low.
• Key events ahead: US PPI, FOMC statement, Powell press conference and Australian jobs report.

The AUD/SUD pair lost almost 50 pips during the American session. It was holding above the 0.7600 and broke to the downside. Recently printed a fresh 2-day low at 0.7564, less than 10 pips above last week lows.

After yesterday’s recovery, the pair was again back below the 0.7600 area and testing the 20-day moving average.

The greenback started to rally during the US session after the WSJ reported that Federal Reserve Chairman Jerome Powell was considering holding a presser after every FOMC meeting. Equity prices turned lower. The Dow Jones was falling 0.25% while US bond yields moved off highs.

The rumor could be clarified tomorrow when the FOMC releases its statement or during Powell post-meeting press conference. The central bank is expected to raise the Fed Funds rate by 25 basis points. Analysts will also take a look to FOMC staff forecasts (dot plot).

Before the events from the Fed, US PPI data is due. On Tuesday, CPI came in line with expectation with the annual rate hitting 2.8%, the highest level since 2012. In Australia, the next key economic numebr will be the employment data to be released Thursday.

Technical levels

Ahead of the Asian session, short-term momentum favors the downside. AUD/USD was standing above the 20-day moving average at 0.7570, below the next support levels might be located at 0.7540, 0.7520 and 0.7470. To the upside, the 0.7600 was the immediate resistance followed by 0.7625 (Jun 12 high) and 0.7645.