AUD/USD fails to sustain a break above 0.77 post-solid CPI

The AUD/USD pair is reversing a brief upward spike above 0.77 handle witnessed following the release of robust Australian CPI, as the bulls once again ran into offers above a break of the last.

AUD/USD: Stronger DXY caps gains

Currently, the AUD/USD pair now trades +0.55% higher at 0.7687, retreating slightly from fresh four-day highs reached at 0.7709. The AUD/USD pair rallied sharply above 0.77 handle in a knee-jerk reaction to better-than expected Australian Q3 CPI figures, after the implied probability of RBA Nov rate cut fell to 6% (previous 15%) on the data release.

However, the major failed to sustain at higher levels and pared gains amid resurgence of demand for the greenback across the board. While steep losses in the Australian benchmark index, the ASX 200 on dwindling RBA rate cut bets, also weighed on the sentiment around the AUD and dragged the spot lower.

With the key Aus CPI out of the way, focus now shifts towards the US flash services and new home sales data due later in the NA session, While the major will continue to get influenced by  the USD dynamics and commodities’ price-action.

The pair finds the immediate resistance at 0.7709 (4-day highs) above which gains could be extended to the next hurdle located 0.7739 (3-week highs) and 0.7757 (Aug 10 high). On the flip side, the immediate support located at 0.7650 (psychological levels). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7631 (5-DMA) and below that at 0.7600 (round figure).