AUD/USD: a bearish consolidation below 200-DMA ahead of this week's key event risks

   •  Consolidating last week’s bearish break below 200-day SMA.
   •  Sliding US bond yields extend some support. 
   •  Focus remains on this week’s FOCM & NFP. 

The AUD/USD pair lacked any firm directional bias and seesawed between tepid gains/minor losses within a 20-pips narrow trading range, below the 0.7700 handle.

The pair struggled to build on Friday's recovery move from over 3-month lows and was being weighed down by a weaker sentiment around commodity space, especially copper, which has been one of the key factors weighing on the commodity-linked Australian Dollar. 

However, with the US Dollar consolidating recent strong gains, a sharp retracement in the US Treasury bond yields was seen lending some support and might now contribute towards limiting deeper losses. 

From a technical perspective, the pair's inability to gain any positive traction, and recover back above last week's break down below the very important 200-day SMA support, clearly seems to indicate that the near-term bearish trajectory could be still far from being over. 

Later during the NA session, the release of core PCE price index, personal income/spending data from the US would now be looked upon for some short-term trading opportunities ahead of this week's major event risks - Wednesday's FOMC decision and the keenly watched NFP on Friday.

Technical levels to watch

On a sustained weakness below mid-0.7600s, the pair is likely to accelerate the slide back towards 0.7625 level (Friday's low) before eventually dropping to the 0.7600 handle. On the upside, any meaningful recovery attempt is likely to confront strong resistance near the 0.7695-0.7700 region (200-day SMA), which if cleared could trigger a short-covering bounce towards 0.7730 resistance.