AUD/USD off lows, still in red near 1-month lows

Haresh Menghani FXStreet

• A modest USD retracement helps ease the bearish pressure.
• Weaker commodities do little to provide any additional boost.
• Traders eye US economic data for some short-term impetus.

The AUD/USD pair managed to recover early lost ground to one-month lows and refreshed session tops in the past hour, albeit lacked any strong follow-through.

The pair extended overnight slump and dropped to an intraday low level of 0.7453, the lowest level since May 16, during the Asian session on Friday. However, the latest US-China trade-related headlines prompted some US Dollar profit-taking and helped ease the bearish pressure.

• US readies second tariffs list on Chinese goods worth $100 bn - Reuters

Meanwhile, a weaker tone around commodity space did little to provide any additional boost to the commodity-linked Australian Dollar, with the pair failing ahead of the key 0.7500 psychological mark and quickly retreating around 15-pips from highs.

Moving ahead, today's second-tier US economic data - Empire State Manufacturing Index, Industrial Production, Capacity Utilization and Prelim UoM Consumer Sentiment, will now be looked upon for some fresh trading impetus later during the early North-American session.

Technical levels to watch

A sustained weakness below mid-0.7400s is likely to accelerate the fall back towards the 0.7415-10 region (11-month lows set on May 9th). On the flip side, the 0.7500 handle is likely to cap any immediate recovery move, above which a fresh bout of short-covering could lift the pair back towards the 0.7560-65 supply zone.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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