AUD/USD pulls away from daily highs as DXY recovers above 96.30

• Trade optimism helps the AUD gather strength on Monday.
• US Dollar Index continues to erase daily losses.

The AUD/USD pair started the week on a positive note as the U.S. President Trump’s comments on the trade negotiations with China provided a boost to the trade-sensitive currencies such as the AUD. After climbing to 0.7070 handle, however, the pair struggled to push higher as the thin trading conditions kept price movements limited on Monday. As of writing, the pair was trading at 0.7043 and was flat on the day.

“Just had a long and very good call with President Xi of China. Deal is moving along very well. If made, it will be very comprehensive, covering all subjects, areas and points of dispute. Big progress being made!” President Trump tweeted out on Saturday.

On the other hand, following a drop to a fresh multi-week low of 96.12 earlier in the day, the US Dollar Index staged a modest recovery in the second half of the day to force the pair to reverse its direction and was last seen down only 0.05% on the day at 96.34.

Technical levels to consider