AUD/USD: Gains remain capped near 0.7260

The Australian maintains its bid tone versus the American dollar in the early European morning, keeping AUD/USD in close proximity to daily peaks.

AUD/USD side-lined near half-yearly lows

Currently, the AUD/USD pair trades modestly higher at 0.7253, struggling to rise above stiff resistance placed near 0.7260 region. The Aussie remains better bid amid resurgence of demand for higher-yielding currencies such as the AUD, especially after yesterday’s shootout in Ankara, where a Russian ambassador was shot dead, triggered risk-aversion across the financial markets.

However, further recovery lacks follow-through amid renewed broad based US dollar strength and weaker copper prices.  Meanwhile, the USD index advances further to hit fresh daily tops at 103.24, while Comex copper futures drop -0.64% to $ 2.48/ pound.

Further dovish RBA meeting minutes also continue to weigh on the AUD and keep the upside in check. Nothing of note for the major in the day ahead, and hence focus turns towards Wednesday’s macro news from the US for fresh impetus.

AUD/USD Levels to watch   

The pair finds the immediate resistance at 0.7290 (5-DMA) above which gains could be extended to the next hurdle located 0.7341 (daily R1) and 0.7375 (10-DMA). On the flip side, the immediate support located 0.7237 (6-month lows). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7217 (daily S1) and below that at 0.7200 (zero figure).