AUD/USD turns lower, drops to fresh session low
|The AUD/USD pair once again failed to sustain early strength beyond the 0.7600 handle and is now headed to the lower end of daily trading range.
The pair started on a positive note following hawkish comments by ex-RBA board member John Edwards. The pair got an additional boost from the ongoing US Dollar slump amid renewed skepticism over the Trump administration's ability to push through pro-growth economic policies.
The pair, however, failed to extend the bullish momentum and retreated over 30-pips from session tops. Tuesday remarks by the Fed Chair Janet Yellen, that the central bank would continue to gradually raise interest rates, remained supportive of the continuous upsurge in the US Treasury bond yields, which although has failed to provide any immediate respite for the USD bulls but was seen weighing on higher-yielding currencies - like the Kiwi.
The pair's latest leg of slide over the past hour or so, to fresh session low near 0.7580-75 region could also be attributed to retreating copper prices, which tends to dent demand for commodity-linked currencies, including the Australian Dollar.
Later during the day, the release of pending home sales data from the US would now be looked upon for some fresh trading impetus, while the US bond yield dynamics would continue to act as a key determinant of the pair's movement through Wednesday's trading session.
• US: Goods trade deficit, wholesale inventories and pending home sales in focus - TDS
Technical levels to watch
A follow through retracement below 0.7570-65 area would turn the pair vulnerable to head back towards retesting the very important 200-day SMA support near 0.7530 region.
On the upside, 0.7600 handle now seems to have emerged as immediate resistance, which is followed by multi-month highs resistance near 0.7625-35 region. A convincing break through 0.7635 resistance now seems to trigger a short-covering rally towards 0.7670 intermediate resistance ahead of the 0.7700 handle.
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