AUD/USD jumps back above 0.7400 handle, NFP in focus

   “¢   Persistent USD selling helps regain positive traction on the last trading day of the week.
   “¢   Trade-war fears/slump in copper prices did little to hinder the positive momentum.
   “¢   Incoming trade-related headlines might continue to infuse volatility ahead of NFP.

The AUD/USD pair regained positive traction on Friday and is now making a fresh attempt to build on the positive momentum beyond the 0.7400 handle.  

Despite Thursday’s upbeat US ISM non-manufacturing PMI and the latest FOMC meeting minutes, which reaffirmed prospects for a gradual Fed monetary policy tightening cycle, the US Dollar struggled to build on overnight modest rebound from over one-week lows and turned out to be one of the key factors helping the pair to catch some fresh bids during the Asian session.  

With the new US tariffs on $34 billion worth of Chinese imports coming into effect from 0400 GMT, news of subsequent retaliatory measures by China added to fears about a full-blown US-China trade war but did little to prompt any fresh selling around the China-proxy Australian Dollar.

Traders even shrugged off the ongoing slump in copper prices, which tends to undermine demand for the commodity-linked Australian Dollar, with the USD price dynamics turning out to be an exclusive driver of the ongoing positive momentum.  

Market participants now turn their attention to the closely-watched US monthly jobs report – popularly known as NFP, which along with any fresh incoming trade-related headline might continue to infuse some volatility across global financial markets and eventually provide some meaningful trading opportunities.

Technical levels to watch

Immediate resistance is pegged near the 0.7425 region (weekly top), above which the pair is likely to aim towards reclaiming the key 0.7500 psychological mark with some intermediate resistance near the 0.7475-80 zone.

On the flip side, the 0.7380 area now seems to have emerged as an immediate support, which if broken might turn the pair vulnerable to head back towards 0.7335 intermediate support en-route the 0.7300 handle.