AUD/USD reclaims lost ground, supported by the 100-DMA

The AUD/USD dropped to its lowest level since March 10 at 0.7530 but has found there where the 100-DMA is located. As we approach the NA session, the pair is down 0.11% at 0.7563.

The pair came under some fresh selling pressure during the Asian session as the weak data from China, Australia's biggest trading partner, once again raised concerns over an economic slowdown. The Caixin Services PMI from China came in at 52.2 missing the expectation of 52.6.

• RBA: concerns over future health of Australian economy - UOB

Furthermore, the US Dollar Index, after falling to 100.30 area following the release of FOMC meeting minutes, was able to erase yesterday's losses during the day, pushing the pair further down. However, the index seems to have lost momentum above 100.60 and is now back around 100.50, allowing the pair to recover some lost ground.

Technical outlook

The initial resistance for the pair is located at 0.7600 (psychological level) before 0.7635/40 region (20-DMA/50-DMA) and 0.7680 (Mar. 30 high). On the downside, a break below 0.7530 (100-DMA) could allow the pair to further drop to 0.7490 (Mar. 9 low) and 0.7455 (Jan. 16 low).

• AUD/USD ranges will surely move lower near term - Westpac