AUD/USD flirting with lows, below 0.76 handle
• Easing US political jitters/US tax bill prompts fresh selling.
• Surging US bond yields add to the downward pressure.
• Tuesday’s Aussie macro data, RBA decision holds the key.
The AUD/USD pair stalled is modest recovery attempt just above the 0.7600 handle and has now dropped to fresh session lows, around the 0.7580-85 region.
A sharp U-turn in the sentiment surrounding the US Dollar, led by clarification over the US President Donald Trump's orders to former National Security adviser Flynn to contact Russian officials, capped the pair's up-move below mid-0.7600s on Friday.
Adding to this, the passage of a long-awaited US tax overhaul bill reignited prospects for an aggressive Fed rate hike moves through 2018 and triggered a fresh wave of a strong upsurge in the US Treasury bond yields, which eventually provided an additional boost to the USD and prompted fresh selling around higher-yielding currencies - like the Aussie.
Against the backdrop of prevalent positive USD tone, traders now look forward to the US factory orders data for some trading opportunities ahead of Tuesday's important Australian macro releases and RBA decision.
Technical levels to watch
Immediate support is pegged near 0.7560 level, below which the pair is likely to accelerate the fall towards the key 0.75 psychological mark en-route 0.7475 support area.
On the upside, any recovery attempt back above the 0.7600 handle is likely to confront resistance near 0.7625 level and any further up-move might continue to be capped near the 0.7645-50 supply zone.