AUD/USD jumps to weekly high and retreats

Having posted a session high at 0.7468, the AUD/USD pair retraced around 30-pips but held on to its near-term recovery gains for fourth session in the previous five.

Currently trading around 0.7435-40 region, the pair is now all set to end the week on a positive note and snap two consecutive weeks of steep losses following Donald Trump's surprise victory in the US presidential election. Upbeat sentiment surrounding base metals, especially Copper, helped the pair to register a smart recovery from five-month low touched at the beginning of the week. 

On Friday, broad based greenback retracement, as measured by the overall US Dollar Index, provided additional boost and lifted the pair to weekly high. The pair, however, eased off from weekly high as traders decided to book some profits as a certain December Fed rate-hike action, coupled with growing expectations of 2-3 more interest rate-hikes in 2017, might continue to underpin the US Dollar and might again start weighing on higher-yielding currencies - like the Aussie.

Investors on Friday will confront second-tier US economic data that include - Goods Trade Balance, Prelim Wholesale Inventories and Markit's Flash Services PMI, due later during NA session.

Technical outlook

Slobodan Drvenica, Information & Analysis Manager at Windsor Brokers Ltd., notes, "Daily close above Tenkan-sen line is seen as minimum requirement, while close above 0.7475 (Fibo 61.8% of 0.7579/0.7308 downleg), would confirm strong near-term bullish stance. Fresh strength emerged above weekly cloud top and signals bullish weekly close that will confirm scenario. Initial supports lay at 0.7415/00 should ideally contain dips to keep intact pivotal support at 0.7362 (24 Nov hourly higher platform)."

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