AUD/USD consolidates in a narrow range just below mid-0.7900s
The AUD/USD pair struggled for a firm direction and was seen consolidating with a 20-pips narrow trading range, just below mid-0.7900s.
Currently holding with minor gains for the third consecutive session, a goodish US Dollar recovery move on Tuesday failed to assist the pair to build on its up-move witnessed over the past couple of days. Adding to this, a modest uptick in the US Treasury bond yields further dented demand for higher-yielding currencies - like the Aussie.
However, the prevalent positive trading sentiment around commodity space, especially copper, and a slight improvement in investors' risk appetite was seen lending some support to commodity-linked/riskier currencies, including the Australian Dollar, and helped limit further losses, at least for the time being.
Looking at the broader picture, the pair continues to confront some fresh supply near 0.7950 level and hence, it would be prudent to wait for a strong follow through buying interest before positioning for any additional near-term up-move for the major.
In absence of any major market moving economic releases from the US, the pair remains at the mercy of broader market risk sentiment and the USD price-dynamics. The key focus, however, would remain on this key Jackson Hole Symposium, where comments by the Fed Chair Janet Yellen would help determine the pair's near-term trajectory.
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Technical levels to watch
Momentum above mid-0.7900s, leading to a subsequent strength beyond 0.7963 level (last Thursday's high), has the potential to lift the pair back towards reclaiming the key 0.80 psychological mark. The up-move could further get extended towards the next major hurdle near the 0.8035-40 region.
On the flip side, any pull-back from higher levels is likely to find immediate support near 0.7925 level, which if broken would turn the pair vulnerable to break below the 0.7900 handle and retest 0.7880-75 strong horizontal support.