AUD/USD conquers 200-DMA barrier at 0.75 psychological mark

Having dropped to session low at 0.7465 level, the AUD/USD pair regained traction and surged through 0.750 psychological mark to the highest level since Nov. 16.

Currently trading around 0.7515-20 region, off around 15-pips from session peak, broadly weaker greenback, in wake of a slump in the US treasury bond yields, helped the pair to finally break through the very important 200-day SMA barrier. However, slightly cautious sentiment around commodity space, especially weakness in Copper prices, failed to provide an additional boost and seems to be the only factor responsible for the pair's mild retracement from 9-week peak. 

Long-dollar unwinding has been the key theme prevalent in the FX market amid growing uncertainty over the incoming Trump administration's fiscal stimulus measures, which further got amplified after President-elect Donald Trump failed to provide any clarity over his probable policy action and has been supportive for the pair's recovery. This coupled with upbeat Chinese economic data also collaborated to the pair's bullish trajectory since the beginning of 2017. 

Investors on Tuesday will remain focused on the crucial Brexit speech by UK PM Theresa May, which is expected to infuse a fresh bout of volatility in the FX market and might provide some fresh impetus. Also in focus would be the release of Empire state manufacturing index from the US and speeches from various Fed officials, which would drive demand for higher-yielding currencies - like the Aussie.

Technical levels to watch

Immediate downside support is pegged at 200-day SMA near 0.75 psychological mark, which if broken is likely to drag the pair back towards 0.7475 horizontal support ahead of 0.7450 support area. On the upside, momentum above session peak resistance near 0.7535 area is likely to get extended towards 0.7555-60 resistance area before the pair attempts a move towards 0.7600 round figure mark.