AUD/USD bears attack 0.7700 on RBA minutes

• AUD/USD extends early Asian losses after RBA minutes for June meeting.
• RBA minutes confirm policymakers’ cautious optimism, no tapering/rate hike until 2024.
• Pause in US Treasury yields’ recovery test market sentiment ahead of US Retail Sales, FOMC.
• Aussie trade deal with UK, covid improvements fail to get accolades.

AUD/USD remains on the back foot, down 0.08% while refreshing intraday low to 0.7705, after the RBA minutes reiterate policymakers’ cautious mood during early Tuesday. In addition to the RBA board’s rejection of rate-hike and tapering concerns, downbeat market sentiment also weigh on the quote.

RBA minutes conveyed, “Board agreed it would be ‘premature to consider ceasing’ the bond-buying program,” during the latest release. The same joins the policymakers’ cautious optimism despite signaling the July meeting as the key.

Read: RBA Minutes: Policy would need to remain highly accommodative to reach full employment

Given the AUD/USD pair’s risk barometer status, the recent drag on the market’s mood ahead of tomorrow’s Fed meeting, not to forget today’s US Retail Sales, also weigh on the quote. In doing so, the AUD/USD prices ignore upbeat sentiment concerning a post-Brexit trade deal with the UK as well as improving virus conditions at home.

It’s worth noting that the Aussie traders’ return after an extended weekend seems to react to the latest catalysts from the Group of Seven (G7) meeting, which challenges China, also weigh on the AUD/USD of late.

Amid these plays, US 10-year Treasury yields snap two-day recovery while the S&P 500 Futures print mild gains by the press time.

While market fears ahead of Wednesday’s Federal Open Market Committee (FOMC) meeting can weigh on the AUD/USD prices, US Retail Sales for May, up for publishing at 12:30 PM GMT today, could offer intermediate direction to the pair.

Read: US May Retail Sales Preview: Analyzing major pairs' reaction to previous releases

Technical analysis

AUD/USD seesaws between 0.7690 and 0.7730, comprising 100-day SMA and a seven-month-old support line, with gradually firming bearish bias. Hence, sellers aim for a clear downside break of 0.7690 trend line support to aim for another support line, near 0.7655. It should, however, be noted that an upside break of 100-day SMA, around 0.7730, should aim for the 0.7800 threshold.