AUD/USD climbs to fresh daily highs, closes in on 0.6950

• AUD/USD is trading near the upper limit of its weekly range.
• US Dollar Index posts small daily gains above 97.20.
• Market action is likely to remain subdued in the remainder of the day.

The AUD/USD pair gained traction on better-than-expected macroeconomic data releases during the Asian trading hours on Friday and stretched higher in the European session. As of writing, the pair was trading at 0.6940, up0.25% on a daily basis.

AUD capitalizes on upbeat data

Earlier in the day, the data published by the Australian Bureau of Statistics revealed that Retail Sales in May surged by 16.9% after declining by 17.7% in April and provided a boost to the AUD. Moreover, Caixin Services PMI data in China jumped to 58.4 in June and beat the market expectation of 49.9.

On the other hand, the US Dollar Index is moving sideways above 97.20 on Friday, keeping the pair’s upside limited for the time being. On Thursday, the US Bureau of Labour Statistics’ jobs report showed that Nonfarm Payrolls (NFP) in June surged by 4.8 million. Despite this impressive figure, rising coronavirus cases in the US didn’t allow risk-on flows to dominate the markets and the greenback stayed against its rivals. The DXY was last seen gaining 0.05% on the day at 97.25.

Financial markets in the US will be closed due to the Independence Day holiday on Friday and the pair is likely to spend the second half of the day in a tight range. On a weekly basis, the pair remains on track to close in the positive territory.

Technical levels to watch for