AUD/USD bulls seek acceptance beyond 0.6700 as Fed Minutes weigh on US Dollar

AUD/USD remains on the buyer's radar despite the latest inaction around 0.6730-40 during Thursday’s Asian session. The reason could be linked to the broad-based US Dollar selling and the market’s cautious optimism.

The US Dollar Index (DXY) dropped the most in a fortnight the previous day after the latest Federal Open Market Committee (FOMC) Meeting Minutes signaled that the policymakers discussed the need of slowing down the interest rate hikes. Additionally weighing on the Greenback were chatters over the “sufficiently restrictive” level of the Federal Reserve’s (Fed) interest rates, as indicated in the Fed Minutes.

It should be noted that the softer US PMIs for November and strong Jobless Claims figures also acted as a negative catalyst for the AUD/USD pair. The preliminary readings of the US S&P Global Manufacturing PMI for November eased to 47.6 from 50.0 expected and 50.4 prior whereas the Services PMI also followed the suit while declining to 46.1 compared to 47.9 market forecasts and 47.8 previous readings. Overall, the S&P Global Composite PMI for November dropped to 46.3 versus 47.7 expected and 48.2 prior readouts.

That said, the United States Weekly Jobless Claims rose the most since June, to 240K versus 225K expected and 223K prior, which in turn favored the sentiment and drowned the US Dollar.

Alternatively, strong prints of the US Durable Goods Orders, up 1.0% in October versus 0.4% marked expectations and downwardly revised 0.3% prior, joined China’s covid woes and downbeat prints of Australia’s S&P Global PMIs for November to challenge the AUD/USD bulls. However, the market’s concentration on the Fed Minutes and hopes of overcoming the Coronavirus woes appeared to have favored the Aussie pair buyers.

Amid these plays, Wall Street closed in the positive territory while the US Treasury yields were downbeat and drowned the US Dollar.

Moving on, an absence of major data/events and a holiday in the US could allow the AUD/USD pair to consolidate some of its latest gains. On the same line could be the COVID-19 fears emanating from China and dovish bias at the Reserve Bank of Australia (RBA). However, the bulls are likely to keep the reins amid the receding hopes of the Fed’s aggressive rate hikes.

Technical analysis

A clear upside break of the 100-SMA and a one-week-old descending trend line, respectively near 0.6695 and 0.6590, keep the AUD/USD pair buyers directed toward the monthly high surrounding 0.6800.