AUD/USD clings to modest recovery gains near mid-0.6500s, lacks follow-through

The AUD/USD pair struggled to register any meaningful recovery and remained well within the striking distance of 11-year lows, around mid-0.6500s.

Extremely oversold conditions helped the pair to gain some positive traction during the Asian session on Thursday, albeit the disappointing Australian private sector capital expenditure figures kept a lid on any strong recovery.

Bulls still seemed reluctant

According to the Australian Bureau of Statistics (ABS), the seasonally adjusted estimate for total new capital expenditure fell by -2.8% during the last quarter of 2019 compared to consensus estimates pointing to a modest 0.4% growth.

This comes on the back of concerns over the global outbreak of the deadly coronavirus and its impact on the world economy, which continued weighing on investors' sentiment and failed to revive demand for the perceived riskier currency – aussie.

Meanwhile, the prevailing risk-off mood led to an extension of the recent slump in the US Treasury bond yields. In fact, the yield on the benchmark 10-year government bond fell to fresh all-time lows, which kept the US dollar bulls on the defensive and helped limit the downside.

Moving ahead, market participants now look forward to important US macro data, which might influence the USD price dynamics and produce some meaningful trading opportunities. Thursday's US economic docket highlights the release of the first revision of the Q2 GDP growth figures, along with the durable goods orders data for January.

Technical levels to watch