AUD/USD reverses recovery gains, back below 0.7200 handle

The AUD/USD pair came under renewed selling pressure and has now drifted into negative territory, reversing its entire recovery move beyond 0.7200 handle.

Currently trading around 0.7180-75 band, testing session lows, a fresh wave of US Dollar buying interest seems to be the only factor exerting heavy selling pressure around the major amid holiday-thinned liquidity conditions. 

Tuesday's impressive US economic data showing, consumer confidence climbing to its highest level in 15-years, reaffirmed Trump-led optimistic view for the US economic growth and supported the US Dollar's strong bullish trend. Moreover, expectation of tighter Fed monetary policy stance in 2017 is also contributing to the selling pressure around higher-yielding currencies - like the Aussie.

Looking at the broader picture, the pair's attempted recovery from near-term oversold conditions got sold into. Hence, a subsequent break below last week's 7-month low should now open room for continuation of the pair's near-term depreciating move. 

Today's US economic calendar remains light, with the only notable release of pending home sales data, which will be looked upon for some immediate respite for bulls. 

Technical levels to watch

From current levels, multi-month lows near 0.7160 remains immediate support to defend, which if broken decisively is likely to accelerate the slide towards 0.7100 round figure mark. Meanwhile on the upside, any recovery attempts might now confront strong resistance near 0.7200 handle, which if cleared might trigger a short-covering rally back towards 0.7225 resistance area ahead of 0.7265-70 hurdle.