AUD/USD re-approaches weekly lows around mid-0.75s

Although the AUD/USD pair was able to find support after refreshing the weekly low at 0.7550 in the early European morning, it couldn't extend its correction above 0.7575 and came under a renewed selling pressure in the NA session. As of writing the pair is trading at 0.7553, down 0.37% on the day.

After gaining around 100 pips in the previous week, the pair closed the first two days of the week with losses and is marching toward another negative daily close. Although the minutes of the June RBA meeting, released on Tuesday, didn't bring any surprises as they reiterated the bank's worries over the household debts and the slow wage growth, they couldn't help the AUD stage a recovery against the USD.

Furthermore, the pair's drop this week could be seen as a technical correction. After rising above the 0.76 handle last Friday, the RSI on the daily graph reached the 70 mark and showed overbought conditions. As of writing, the RSI is at 54, inching closer to the neutral zone of 50.

On the other hand, amid a lack of major fundamental catalysts, the US Dollar Index continues to float above the 97 handle, making it difficult for the pair to gather a bullish momentum. At the moment, the index is at 97.35, down 0.05% on the day.

Technical Outlook

The pair could face the initial support at 0.7535 (100-DMA) ahead of 0.7500 (psychological level) and 0.7420 (May 31 low). On the upside, resistances align at 0.7600 (psychological level), 0.7635 (Jun. 14 high) and 0.7680 (Mar. 3 high).

• AUD/USD neutral, likely between 0.7530/0.7630 – UOB
• AUD/USD: Range resistance to cap AUD before retracing lower - Westpac