AUD / USD extends daily bounce towards 0.7630, seems to close the week lower

• AUD / USD continues to rise during the American session.
• The US dollar index declines as market sentiment improves.
• Market optimism makes it difficult for the USD to find demand.

The AUD/USD it retained its bullish momentum during US trading hours and hit a daily high of 0.7638. At time of writing, the pair was up 0.65% on the day at 0.7628. Despite Friday’s bounce, AUD / USD is still on track to end the week in negative territory.

Renewed USD weakness in the second half of the day allowed AUD / USD to rise. With the major Wall Street indices opening higher on the last day of the week, the US Dollar Index (DXY) turned south and fell to a daily low of 92.64. Currently, the S&P 500 Index is up 0.67% on the day to 3,935 and the DXY is losing 0.15% to 92.70.

Data from the US showed that personal income and personal expenses in February decreased 7.1% and 1%, respectively. Additionally, the US Bureau of Economic Analysis reported that the Basic Personal Consumption Expenditure (PCE) Price Index fell to 1.4% annually from 1.5% in January.

Finally, the University of Michigan Consumer Sentiment Index rose to its highest level in a year at 84.9 in the final reading for March. However, investors showed little or no reaction to these figures.

AUD / USD technical perspective

UOB Group analysts think that the bearish outlook for AUD / USD remains intact as long as the pair does not move above 0.7680.

“While there is no change in our opinion for now, short-term oversold conditions could lead to a couple of days of consolidation first,” analysts said. “Looking ahead, a breakout of 0.7560 (note that the AUD fell to 0.7564 during New York hours) would shift focus to 0.7510.”

Additional levels