- AUD / USD captures some buying on Monday and halts its recent decline from the 0.7815-20 area.
- With the Fed’s pessimistic expectations, risk appetite weighs on the USD and offers some support to the pair.
- Investors are turning their attention to the US ISM PMI and Powell’s speech for a boost ahead of Tuesday’s RBA.
The pair AUD/USD maintains its modest gains during the first half of the European session on Monday, staying close to the upper end of its intraday range around the region of 0.7720.
Having shown some resistance below the 0.7700 level, the pair has moved higher on the first day of a new week and has recovered part of Friday’s drop to week-long lows. The AUD / USD pair, for now, appears to have halted its recent sharp retracement from the 0.7815-20 zone and it has been supported by a combination of factors.
The US dollar has struggled to capitalize on last week’s rally from the lowest level since Feb. 26 amid expectations that the Fed will keep interest rates low for a longer period. This, along with the prevailing sentiment of risk appetite, has weighed further on the safe-haven US dollar and offered some support to the perceived riskier Australian dollar.
The rebound marks the first day of positive movement in the previous three days, although it lacks a strong following. Investors now seem reluctant to push open aggressively, preferring to wait on the sidelines before the RBA’s latest monetary policy update, scheduled during the Asian session on Tuesday.
Meanwhile, the US economic calendar, which includes the release of the ISM Manufacturing PMI, could generate new momentum. Aside from this, a scheduled speech by Fed Chairman Jerome Powell will influence USD price dynamics and could further contribute to generating some short-term trading opportunities around the AUD / USD pair.
AUD / USD technical levels
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