/USD Tests Bottom Of Recent Range

AUD/USD touched the bottom of its recent range at 0.7640 ahead of the FOMC meeting as the USD spiked higher. The rate recovered slightly before pulling back towards lows again. Last down 8 pips at 0.7655.

• Negative risk sentiment could exert further downward pressure on the pair, US equity markets had their worst day since October.
• Concerns around iron ore demand is also weighing on AUD. China announced a series of measures earlier this week designed to accelerate a reduction of steel output. Among these are a strict ban on illegal new capacity, promoting mergers, and a promises that supply will be reduced in 2021, according to the Ministry of Industry and Information Technology.
• AUDUSD opened further the gap with recent highs Wednesday but remains within this year's sideways range that remains a flat correction. This pattern reinforces the underlying bullish outlook. The range has defined key directional parameters at 0.7820, Jan 6 high and 0.7659, Jan 18 low. A break higher would confirm a resumption of the uptrend and open 0.7885, Mar 15, 2018 high. On the downside, clearance of 0.7659 would signal the start of a corrective pullback
• Markets look ahead to Australia Q4 terms of trade, data due at 0030GMT/1130AEDT.