AUD/USD bulls regain control, jumps back above mid-0.7600s
| • USD fails to build on Friday’s attempted up-move.
• Aussie gains an additional boost from MYEFO.
• Additional gains capped by surging US bond yields.
The AUD/USD pair regained some fresh traction on Monday and has now recovered Friday’s retracement slide from over 1-month tops.
The US Dollar received a minor lift on Friday after the long-awaited US tax reform bill moved a step closer to ratification and prompted profit-taking from closer to the very important 200-day SMA barrier.
The USD, however, failed to build on the attempted up-move and helped the pair to catch some fresh bids at the start of a new trading week. The Australian Dollar got an additional boost from today's release of Australia Mid-Year Economic and Fiscal Outlook (MYEFO).
It, however, remains to be seen if bulls are able to maintain their dominant position or the pair once again fails to conquer the 0.7700 barrier amid a goodish pickup in the US Treasury bond yields, which tend to weigh on higher-yielding currencies - like the Aussie.
In absence of any major market moving economic releases, the pair remains at the broader market sentiment surrounding the greenback and the US bond yield dynamics.
Technical levels to watch
A follow-through buying interest beyond 0.7675 level has the potential to lift the pair back towards the 0.7700 supply zone (200-day SMA), above which the up-move could further get extended towards 0.7730 resistance.
On the flip side, retracement back below 0.7640-35 immediate support might prompt some additional profit taking back towards the 0.7600 handle en-route 0.7585-80 support area.
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