AUD/USD surges to 1-1/2 week tops, further beyond 0.7200 handle
| • Softer US CPI/slump in the US bond yields prompt some aggressive USD selling.
• Upbeat Aussie jobs data/easing US-China trade tensions remains supportive.
• Bullish copper prices/technical buying above 0.72 mark provides an additional boost.
The AUD/USD pair finally broke out of its European session consolidation phase and surged to 1-1/2 week tops, around the 0.7220-30 region post-US CPI.
The latest leg of a sudden spike over the past hour or so could be solely attributed to some intense US Dollar selling pressure, following the release of weaker than expected US consumer inflation figures.
The data indicated that the recent upturn in inflation might have eased and thus, dampened prospects for any aggressive Fed monetary policy tightening, evident from the ongoing slump in the US Treasury bond yields.
Meanwhile, a combination of other positive factors - today's upbeat Aussie jobs report, easing US-China trade tensions and bullish copper prices, continued underpinning the Australian Dollar and remained supportive of the pair's strong up-move.
Adding to this, possibilities of some short-term trading stops being triggered on a decisive move beyond the 0.7200 handle could also be one of the factors providing some additional boost to the major.
Today's strong follow-through up-move now seems to suggest that the near-term bottom is already in place and the pair might continue with its recovery move from 30-month lows set on Tuesday.
Technical levels to watch
A follow-through buying has the potential to continue boosting the pair further towards 0.7270 intermediate resistance en-route the 0.7300 handle. On the flip side, any meaningful retracement back below the 0.7200 handle might now be limited and is likely find some fresh buying interest near the 0.7170-65 horizontal zone.
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