AUD/USD dumped to 0.7350 ahead of Aus annual budget

The AUD/USD pair is seen flirting with four-month troughs struck at 0.7354 last hour, as the AUD bears remain in complete control on the back of  an unexpected contraction seen in the Australian retail sales data.

Australia's retail sales surprise to the downside in April

Moreover, renewed weakness in copper prices on Comex exacerbated the pain in the Aussie. Comex copper futures drop -0.45% to $ 2.483/pound, meandering near 5-month lows.

Furthermore, with treasury yields hovering near one-month tops on increased bets of a June Fed rate hike, the US dollar sits at 2-day tops against its main competitors, which in turn adds to the bearishness in the AUD/USD pair.

From a broader perspective, the spot remains weak, as RBA continues to see rising house prices as a big risk, which may keep the central bank away from hiking rates as the shift move in its monetary policy.

Next of relevance for the major remains the Australian annual budget release due to be released during the European hours.

AUD/USD Levels to watch   

At 0.7357, the immediate support is located at 0.7300 (zero figure). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7284 (early Jan lows) and below that 0.7250 (psychological levels). On the flip side, the pair finds the immediate resistance at 0.7399 (May 9 high) above which gains could be extended to the next hurdle located 0.7445 (10-DMA) and 0.7489 (20-DMA).