“¢ The USD consolidates overnight upsurge and helps find support near 0.7200 mark.
“¢ Positive copper prices underpinned commodity-linked Aussie and remained supportive.
“¢ Today’s US economic docket eyed for some fresh impetus amid S-China trade tensions.
The AUD/USD pair staged a goodish rebound from one-week lows and recovered a part of previous session’s slump.
The pair added to its weakness recorded at the start of a new trading week and remained under some intense selling pressure through Tuesday’s trading session amid resurgent US Dollar demand.
Adding to this, a follow-through sell-off in the US equity markets, amid escalating worries about slowing global growth, weighed heavily on perceived riskier currencies and further collaborated to the pair’s sharp intraday slide of around 90-pips.
With the greenback now consolidating overnight strong upsurge, the pair stalled its corrective slide from over 2-1/2 month, set last Friday, and found decent support near the 0.7200 handle following the release of Melbourne Institute leading index.
The index ticked higher to 0.1% for October as compared to an upwardly revised flat reading in the previous month, which coupled with the prevalent positive mood around commodity space, especially copper, underpinned the commodity-linked Aussie and remained supportive of the goodish intraday rebound.
It, however, remains to be seen if the pair is able to capitalize on the positive momentum or the up-move meet with some fresh supply at higher levels amid resurfacing US-China trade tensions, which had been one of the key factors weighing on the China-proxy Australian Dollar.
Moving ahead, market participants now look forward to the US economic docket – highlighting the release of durable goods orders, usual weekly initial jobless claims and revised UoM Consumer Sentiment index, in order to grab some short-term trading opportunities.
Technical levels to watch
Immediate resistance is pegged near mid-0.7200s (100-day SMA), above which the pair is likely to aim towards challenging the 0.7275-80 support zone before eventually darting to reclaim the 0.7300 handle. On the flip side, the 0.7200 handle now becomes immediate strong support, which if broken is likely to accelerate the fall towards the 0.7165 region.
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