AUD/USD off highs, but holds above 0.78 handle ahead of US data

The AUD/USD pair trimmed some of its early strong gains and has now retreated over 20-pips from one-week tops touched earlier during European session.

With investors looking past Wednesday's perceived dovish FOMC meeting minutes, a modest pickup in the greenback demand has been one of the key factors behind the pair's retracement from highs. 

In fact, the key US Dollar Index rebounded from 2-week lows and seems to have prompted some profit taking, especially after the pair's strong recovery move of nearly 100-pips since the beginning of this week. 

The pair, however, continues to hold in positive territory for the third consecutive session and was being supported by weaker tone around the US Treasury bond yields, which tends to underpin demand for higher-yielding currencies - like the Aussie.

Traders now look forward to the US economic docket, featuring the release of weekly jobless claims and PPI figures, which along with Fedspeaks would provide some fresh impetus.

   •  US: PPI data in the limelight – Rabobank

Technical levels to watch

The 100-day SMA resistance break point, near the 0.7800-0.7795 region, remains immediate support to defend, which if broken would turn the pair vulnerable to head back towards retesting mid-0.7700s support.

On the upside, bulls would be eyeing for a follow through buying interest beyond 0.7835 area, above which the pair is likely surpass 0.7860-65 intermediate hurdle and aim towards reclaiming the 0.7900 handle.