AUD/USD slides below 50-DMA, fast approaching 0.76 handle
|Having posted a session high near 0.7640 region, the AUD/USD pair came under some renewed selling pressure and dropped into negative territory for the fourth consecutive session.
Currently trading around 0.7610 region, the pair has now slipped below the 50-day SMA support to 1-1/2 week lows amid broad based greenback recovery. Rising US treasury bond yields remains supportive of the recovery move witnessed around the key US Dollar Index and has been one of the factors weighing on higher-yielding currencies - like the Aussie.
Moreover, the ongoing bearish sentiment in the commodity space, especially copper, is further denting demand for commodity-linked currencies and collaborated to the pair's corrective slide.
With today's drop, the pair has now reversed nearly 150-pips from over 4-month highs touched at the beginning of this week and reversed over 50% of last week's post-FOMC recovery move.
Moving ahead, speech by Chicago Fed President Charles Evans and the release of durable goods orders from the US would now be looked upon for some fresh impetus. Investors focus, however, would remain glued to the very important vote on Trump's healthcare bill, the first major legislation of the new administration.
Technical outlook
Omkar Godbole, Analyst and Editor at FXStreet notes, "in any case, the bulls need to defend the rising lows formation (rising trend line is seen offering support around 0.7550 levels today… would slope higher to 0.7580-0.76 next week. The breach of the rising trend line would signal the rally from the Dec 23 low of 0.7160 has topped out."
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