AUD/USD refreshes 2-week lows, 0.6900 mark back on sight

• The USD remains well supported by tempered Fed rate cut expectations.
• Fading US-China trade optimism/dismal domestic data weigh on the Aussie.
• Deteriorating global risk sentiment does little to ease the bearish pressure.

The AUD/USD pair finally broke down of its European session consolidation phase and refreshed two-week lows, around the 0.6925 region in the last hour.

The pair came under some heavy selling pressure on Tuesday and added to last week's pullback from near two-month tops, around mid-0.7000s, with a combination of negative forces dragging it farther below 50-day SMA support.

Against the backdrop of fading US-China trade optimism, the China-proxy Australian Dollar was further weighed down by Tuesday's softer National Bank of Australia's survey data, showing that business confidence index fell from 7 to 2 in June.

Meanwhile, the US Dollar remained well supported by tempered Fed rate cut expectations - reinforced by a goodish pickup in the US Treasury bond yields, while deteriorating risk sentiment also did little to lend any support to perceived riskier currencies - like the Aussie.

However, a modest USD pullback from near three-week tops extended some support and might help limit deeper losses amid extremely oversold conditions on hourly charts and absent relevant market moving economic releases from the US.

Later during the North-American session, scheduled speeches by St. Louis Fed President James Bullard and the Fed Governor Randal Quarles will now be looked upon for some short-term trading impetus, though the key focus will remain on the Fed Chair Jerome Powell's a two-day Congressional testimony on Wednesday and Thursday.

Technical levels to watch