AUD / USD moves away from session highs and remains above 0.7250

• AUD / USD posted modest daily gains after Monday’s slide.
• The major Wall Street indices are still on track to open decisively higher.
• The US dollar index fell towards 93.00 on Tuesday.

Pressured by the intense flight to safety, the pair AUD/USD fell to its lowest level since late August at 0.7219. With the market mood improving on Tuesday, the pair managed to stage a rebound and hit a daily high of 0.7283. At time of writing, the pair was up 0.17% on the day at 0.7262.

With all eyes pointing to Wall Street

Reflecting positive risk sentiment, US equity index futures are up between 0.7% and 0.85. Should the major Wall Street indices post decisive gains after the opening bell, the USD is likely to struggle to find demand. At the moment, the US Dollar Index (DXY) is down 0.1% at 93.13.

Data on housing starts and building permits for August will appear on the US economic calendar later in the session.

On the other hand, the meeting minutes of the Reserve Bank of Australia (RBA) did not trigger a significant market reaction during Asian trading hours on Tuesday. The publication showed that policymakers remain committed to maintaining highly favorable monetary conditions and that they will review the bond purchase program in light of changing economic conditions.

On Wednesday, Australia’s westpac leading index will be seen for fresh momentum. More importantly, the People’s Bank of China (PBoC) will announce its monetary policy decisions. Should the PBoC address concerns about the Evergrande crisis and take political action, the AUD could continue to rally against its US counterpart.

Technical levels