“¢ Investors looked past Powell’s not so hawkish comments on Friday.
“¢ A modest USD uptick keeps a lid on the early uptick.
“¢ Positive copper prices might help limit downside amid empty economic docket.
The AUD/USD pair surrendered an early uptick to mid-0.7300s and is currently placed at the lower end of its daily trading range.
The pair struggled to build on Friday’s strong upsurge, triggered by fading Australian political jitters and dovish comments by the Fed Chair Jerome Powell. At a closely watched Jackson Hole symposium, Powell on Friday reaffirmed the case for gradual rate hikes but disappointed USD bulls hoping for a more hawkish message.
Meanwhile, the latest leg of the retreat of around 20-25 pips from session tops could be attributed to a modest US Dollar uptick, especially against Chinese Yuan, which capped any further up-move for the China-proxy Australian Dollar.
Traders seemed to have largely shrugged off a mildly positive tone around copper prices, which did little to provide any fresh bullish impetus to the commodity-linked Aussie, albeit should help limit any deeper losses, at least for the time being.
In absence of any major market moving economic releases, the USD price dynamics might continue to act as an exclusive driver of the pair’s momentum at the start of a new trading week.
Technical levels to watch
Immediate support is pegged near the 0.7310-0.7300 region, below which the pair is likely to slide back towards 0.7275-70 horizontal zone en-route 0.7240-35 strong support. On the flip side, the 0.7345-50 area might continue to act as an immediate hurdle, which if cleared could lift the pair back towards testing 50-day SMA hurdle near the 0.7375 region.
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