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  • AUD/USD remains below 50-day SMA amid sluggish market conditions.
  • Trade optimism fades, Fedspeak repeats the previous statements.
  • RBA minutes will be observed to forecast the next decision, US-China trade news can also entertain markets.

With looming uncertainty surrounding the US-China trade deal and a lack of major catalysts, AUD/USD stays below 50-day SMA while trading around 0.6810 by the press time of early Asian session on Tuesday.

Markets recently shrugged off the ANZ Roy Morgan Consumer Confidence that weakened below 111.10 to 109.90. The weekly sentiment data fails to move the Aussie as traders are waiting for the RBA minutes amid a lack of major directives.

The Australia Dollar (AUD) recently failed to cross the 50-day SMA level as doubts over the US-China trade deal re-emerges after Chinese officials, via CNBC, showed less optimism on reaching a deal.

Also adding to the market’s lack of sentiment is the meeting between the US Federal Reserve Chairman Jerome Powell, US President Trump and the Trade Secretary Steve Mnuchin. The meeting said to be hovered around issues like monetary policy, further rate cuts, strong US dollar (USD) and trade deal, as inferred from President Trump’s tweets. Furthermore, comments from the Federal Reserve speakers off-late have been repeating the support for the present monetary policy while showing an overall optimism.

That said, the US 10-year Treasury yields softened to 1.815% while Wall Street closed in a narrow profit zone to the record highs.

Traders will now keep an eye over the monetary policy minutes of the Reserve Bank of Australia’s (RBA) latest meeting. While a no rate change decision makes the minute statement less interesting, investors will be on the lookout for clues relating to downward revision of the growth forecasts and the statement that the Board was mindful that rates were already very low and that each further cut brings closer the point at which other policy options come into play.

Following that, the US housing market numbers and Fedspeak will entertain the market players while trade/political headlines will keep the driver’s seat.

Technical Analysis

The pair’s recent pullback from the 50-day Simple Moving Average (SMA) level of 0.6815 gradually diverts sellers towards the monthly low near 0.6770 whereas an upside break can aim for November 05 low around 0.6860.