AUD/USD edges below 0.74 ahead of FOMC minutes

• Upbeat PMI data helps USD find some demand.
• US Dollar Index recovers above 94.
• AUD/USD goes into consolidation ahead of the FOMC minutes.

The AUD/USD pair advanced to a fresh session high at 0.7408 in the early NA session but failed to hold there as the upbeat PMI data from the United States helped the greenback find some demand. As of writing, the pair was trading at 0.7393, adding 0.11% on the day.

Earlier today, the first data from the United States showed that the private sector employment increased 177K in June to fall short of the markets' expectation of 190K. The initial reaction to this data dragged the US Dollar Index to a fresh 10-day low below 93. The second data set, however, showed that the business activity in the service sector in the U.S. expanded at a faster-than-expected pace with both ISM and Markit's PMI beating the estimates. The DXY was last seen at 94.05, losing 0.15% on the day.

Later in the day, investors will be looking for fresh clues in the FOMC's June meeting minutes regarding another 25 bps rate hike in September. According to the CME Group Fedwatch tool, markets are pricing a 77.7% probability of a September hike. A hawkish statement from the FOMC could ramp up the odds and allow the DXY to continue to recover its recent losses.

Technical outlook

The pair could face the first technical resistance at 0.7410 (20-DMA/daily high) ahead of 0.7445 (Jun. 22 low) and 0.7500 (psychological level). On the downside, supports are located at 0.7360 (daily low), 0.7310/00 (Jul. 2 low/psychological level) and 0.7240 (Dec. 19, 2016, low).