AUD/USD extends rebound to 0.7740 area ahead of US ADP and PMI data
|- AUD/USD is edging higher following Tuesday's sharp drop.
- US Dollar Index retreats from multi-week highs, holds above 91.00.
- Focus shifts to ADP and Services PMI data from US.
The AUD/USD pair dropped to its lowest level since mid-April at 0.7676 on Tuesday and managed to stage a technical correction before closing in the negative territory above 0.7700. With the greenback losing interest on Wednesday, the pair extended its recovery on Wednesday and was last seen gaining 0.43% on the day at 0.7738.
Improving market mood hurts USD
Earlier in the day, the data from Australia showed that the Commonwealth Bank Services PMI rose to 58.8 in April. This reading came in slightly better than the market expectation of 58.6 and helped the AUD gather strength.
In the meantime, the positive shift seen in risk sentiment is making it difficult for the USD to find demand ahead of key macroeconomic data releases. At the moment, major European equity indexes are up more than 1% on the day and the S&P 500 Futures are rising 0.4%. The US Dollar Index, which tracks the greenback's performance against a basket of six major currencies, is down 0.06% at 91.22.
Later in the session, the ADP Employment Change and the ISM Services PMI data will be featured in the US economic docket. Furthermore, Boston Federal Reserve President Eric Rosengren, Cleveland Federal President Loretta Mester and Chicago Federal Reserve Bank President Charles Evans will be delivering speeches.
Technical levels to watch for
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