Having faced rejection at the very important 200-day SMA on Tuesday, the AUD/USD pair came under some fresh selling pressure and snapped three consecutive days of winning streak.
The pair has now weakened below the key 0.75 psychological mark and the latest leg of downslide could be attributed to persistent weaker sentiment surrounding copper prices, which tends to drive demand for commodity-linked currencies, including the Australian Dollar.
Adding to this, a modest US Dollar up-tick, despite of slightly weaker tone surrounding the US treasury bond yields, further collaborated to the pair's downslide.
• US Dollar up smalls near 98.80, FOMC on sight
Heading into the big event risk- FOMC decision, might have also prompted some profit taking, with the pair reversing over 50% of its recent recovery move of over 100-pips from last week's 3-1/2 month lows.
Today's key focus would remain on the much awaited Fed announcement. Although the Fed is widely expected to maintain status quo but investors would be looking for clues over June rate-hike action and hence, should act as a fresh catalyst for the pair's near-term trajectory.
Apart from the FOMC decision, today's US economic docket also features the release of ADP report and ISM non-manufacturing PMI, which should provide some short-term trading impetus during early NA session.
Technical levels to watch
On a sustained break below the 0.75 handle, the pair is likely to drift towards 0.7485-80 horizontal support before eventually dropping to test 0.7460-50 important support. On the upside, 200-day SMA near 0.7555 region now becomes immediate strong hurdle, which if conquered might trigger a short-covering rally towards 50-day SMA resistance near 0.7590 region.
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