- AUD/USD staged a solid intraday bounce of over 100 pips amid some heavy USD selling.
- The USD bearish pressure remained unabated after weaker US consumer inflation figures.
- Some follow-through buying beyond the 0.6560 needed to confirm a near-term bullish bias.
The AUD/USD pair jumped to fresh session tops near mid-0.6500s, with bulls making a fresh attempt to build on the momentum beyond 100-day SMA post-US macro data.
A combination of supporting factors assisted the pair to attract some dip-buying on Tuesday and rally over 100 pips from the Asian session swing lows, around the 0.6430 region. A sharp US dollar pullback from two-week tops extended some initial support, while a goodish intraday rebound in the equity markets provided an additional boost to the perceived riskier aussie.
Against the backdrop of speculations that the Fed might push interest rates below zero, the greenback was further pressured by a fresh leg down in the US Treasury bond yields. The intraday USD selling bias remained unabated following the release of the latest US consumer inflation figures, which showed that the headline CPI tumble 0.8% in April and core CPI fell more-than-expected.
With Tuesday important US macro data out of the way, it will now be interesting to see if the pair is able to capitalize on the move or continues with its struggle to sustain above 100-day SMA. Meanwhile, some follow-through buying above the overnight swing high, around the 0.6560 region, might be seen as a fresh trigger for bullish traders and set the stage for a further appreciating move.
Moving ahead, market participants now look forward to scheduled speeches by influential FOMC member, which might influence the USD price dynamics and produce some meaningful trading opportunities around the AUD/USD pair.
Technical levels to watch
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