AUD/USD flirting with 7-month lows near 0.7200 handle

After a brief recovery on Tuesday, the AUD/USD pair resumed with its bearish trend and remained under some selling pressure on Friday. 

Currently trading around 0.7215 level, having posted a session low just below 0.7200 handle, the pair maintained its offered tone for seventh trading session in the previous eight and moved back closer to nearly 7-month lows touched on Thursday, when the pair dipped below 0.7200 handle for the first time May 31. The pair did bounce off multi-month lows after mixed US economic data, especially disappointing spending data. 

Meanwhile, a slump in iron ore prices has been the key factor weighing on the pair on Friday. This coupled with hawkish Fed outlook for 2017 continues to dent demand for higher-yielding currencies - like the Aussie, and has kept the pair subdued near multi-month lows. Nevertheless, the pair is on track to close in red for the third consecutive week. 

From the US, new home sales data and revised consumer confidence index will be in focus during early NA session but seems unlikely to provide any fresh impetus amid pre-holiday dull trading action. 

Technical levels to watch

Sustained weakness back below 0.7200 handle now seems to open room for an immediate slide towards May monthly lows support near 0.7150-45 region, en-route 0.7100 round figure mark. On the upside, 0.7225-30 region (session peak) now becomes immediate resistance, which if cleared could lift the pair back towards 0.7260 resistance area.