AUD/USD recovers further from Friday's 5-month lows
| • Bounces off lows, but seems lacking conviction.
• This week’s key events/data awaited for fresh impetus.
• Tuesday’s RBA minutes to infuse some volatility.
The AUD/USD pair has managed to recover early lost ground, back closer to Friday's 5-month lows, and is currently placed at fresh session tops, around the 0.7570 region.
A fresh wave of US Dollar buying interest, led by a German political news-led sell-off around the EUR/USD major, kept the pair on the back-foot at the start of a new trading week. The early dip, however, was bought into and was seen finding some support from a sharp slide in the US Treasury bond yields, which tends to benefit higher-yielding currencies - like the Aussie.
Meanwhile, the up-move lacked strong conviction as investors now seemed to refrain from placing aggressive bets ahead of this week's key event risks - RBA and FOMC policy meeting minutes on Tuesday and Wednesday respectively, along with the release of key US durable goods orders.
Moreover, the prevalent negative trading sentiment around commodity space has failed to provide any additional boost to the commodity-linked Australian Dollar and also seems to be collaborating towards keeping a lid on any additional up-move for the pair.
Today's US economic docket lacks any market moving economic releases and hence, the pair remains at the mercy of US bond yield dynamics, with some repositioning trade, ahead of Tuesday's RBA meeting, possibly infusing some volatility at the start of a new trading week.
Technical levels to watch
Any meaningful recovery attempt is likely to confront resistance near 0.7585 horizontal level and is closely followed by the 0.7600 handle. On the flip side, weakness below mid-0.7500s might turn the pair vulnerable to extend its downward trajectory towards the key 0.7500 psychological mark.
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