AUD/USD jumps to fresh multi-day tops, retakes 0.7700 handle

   •  Builds on overnight rebound from fresh YTD lows amid subdued USD demand.
   •  Strong follow-through buying needed to confirm near-term bottom formation.
   •  Next week’s important releases and RBA decision would determine the next direction.

The AUD/USD pair finally broke out of its Asian session consolidation phase and is now looking to build on the momentum beyond the 0.7700 handle.

The pair caught some fresh bids on Friday and traded with a positive bias for the second consecutive session. A subdued US Dollar demand was seen as one of the key factors assisting the pair to build on overnight rebound from fresh YTD lows. 

In absence of any fresh fundamental trigger, holiday-thinned liquidity conditions seems have prompted some short-covering move and further collaborated to the pair's goodish rebound back to the 0.7700 handle.

It, however, remains to be seen if the up-move is backed by any genuine buying or is solely led by some short-covering move. Hence, it would be prudent to wait for a strong follow-through buying interest before confirming the pair might have bottomed out in the near-term.

Moving ahead, next week's important macro releases, scheduled at the start of a new month and the latest RBA monetary policy update, will now be looked upon for some fresh directional impetus.

Technical levels to watch

Any subsequent up-move now seems to get extended towards the 0.7745-50 supply zone, above which the pair is likely to dart back towards reclaiming the 0.7800 handle. On the flip side, weakness back below 0.7675 immediate support might negate prospects for any further up-move and drag the pair back towards 0.7640 intermediate support en-route the 0.7600 handle.