AUD/USD pares gains to 0.7200, eyeing 0.7175 support

By FXStreet After a bullish spike to 0.7219 earlier during European opening session, the AUD/USD pair pared some of its gains and to currently trade a tad below 0.7200 handle.

As USD bulls turned cautious at higher level, the AUD/USD pair attempted a tepid recovery on Wednesday along with a bounce in base metals that were mostly trading in positive territory on the LME.

Meanwhile, the Australian construction output data for Q1 2016, released earlier during Asian session, disappointed Aussie bulls and raised prospects of a further rate-cut announcement by the Australian central bank, RBA.

Increasing possibilities of an imminent Fed rate-hike and prospects of a further rate-cut by RBA might continue to cap any near-term recovery for the AUD/USD pair.

Technical levels to watch

Immediate downside seems to be protected near yesterday’s close of 0.7175, which if broken should open room for an immediate drop towards 0.7150-45 intermediate support ahead of 0.7100 round figure mark support.

On the flip side, the pair need to make a sustained move above 0.7225, which if convincingly conquered sets the stage for an up-move beyond 0.7250-55 200-day SMA resistance, back towards 0.7300-0.7310 resistance zone.
For more information, read our latest forex news. …read more

Source:: FX Street