AUD/USD on a steady recovery path, 0.7400 – a whisker away

The AUD/USD pair stalled its two-day sell-off and made a steady comeback in Asia, with the bulls now eyeing a break above 0.74 handle amid risk-off market profile.

AUD/USD finds buyers near 0.7370

The spot is back on the bids on Friday, partly driven by subdued trading activity seen around the US dollar and treasury yields, reflecting a typical scenario ahead of the key NFP report. The USD index trades almost unchanged around 97.15 levels, extending its overnight side-trend into Asia.

Meanwhile, a risk-friendly market environment, in the wake of a risk-on rally in the Asian indices, also lends support to the recovery in the higher-yielding currency AUD. Also, Thursday’s upbeat Capex and retail sales data continue to underpin the sentiment around the major.

However, the bulls may struggle to take on the recovery above 0.74 handle, as sell-off across the commodities space could keep a lid on the upside. Comex copper futures are down -0.40%, gold prices drop -0.35%, while both crude benchmarks lose about -0.25%.

Focus now remains on the much-awaited US non-farm payrolls data due later in the NA session for fresh direction on the spot.

AUD/USD Levels to watch   

At 0.7386, the pair finds the immediate resistance at 0.7431/32 (5 & 20-DMA) above which gains could be extended to the next hurdle located 0.7476 (50-DMA) and 0.7520/23 (3-week tops/ 200-DMA). On the flip side, the immediate support is located at 0.7373 (3-week low). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7350 (psychological levels) and below that 0.7331 (May 11 low).