AUD/USD drops to test daily lows as US Dollar strengthens
- US dollar recovered versus NZD, AUD on risk aversion.
- Australian dollar moved away from weekly highs, heads for daily lows.
The AUD/USD pair reached earlier the highest level in a month at 0.7811 but failed to hold on top of 0.7800 and pulled back. During the American session continues to retreat and it was about to test daily lows. It was trading at 0.7768 slightly above Asian session low located at 0.7762.
Horus ago, AUD/USD bottomed following the release of the Australian Q1 jobs report that came in below expectoration. The negative momentum was short-lived and the pair rebounded.
The attempt to extend gains remains capped by the 0.7800/10 area, showing lack of strength in the Aussie. At the same time, it remains supported around 0.7750. Price is moving sideways around 0.7770, consolidating last week gains.
Despite moving in ranges against the US Dollar, the Aussie is again up versus the Kiwi despite the data. Analysts point out that the improvement in risk sentiment this week and also higher commodity prices offer support to the AUD. Next week is due data on Australian inflation that is likely to be a key driver. Today’s US economic data had no impact on markets.
Technical levels
To the upside, AUD/USD could face resistance first at 0.7790 and then around 0.7810 and at 0.7835. On the flip side, immediate support is seen at 0.7755/60 before the 0.7740 area; below the last one, momentum would favor the US dollar, opening the doors for a slide to 0.7710.