AUD/USD extends bullish momentum further beyond 0.74 mark

The AUD/USD pair traded with positive bias for the fourth consecutive session and extended last week's recovery move from 4-month lows to move back above the 0.7400 handle.

Currently trading around 0.7415-20 band, testing session highs, the pair continued gaining traction despite of weaker than expected Chinese macro data, which tends to derive demand for China-proxy Australian Dollar. A subdued greenback price action, with the key US Dollar Index extending Friday's disappointing US economic data-led slide, has been a key factor supporting driving the pair higher. 

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Meanwhile, the positive tone surrounding commodity space, especially copper, was also seen lending support to the commodity-linked currencies, including the Australian Dollar, and further collaborated to the pair's strong up-move back closer to one-week high touched on Friday.

Today's relatively thin US economic docket, featuring the only release of Empire State Manufacturing Index, would now be looked upon for some fresh impetus later during the NA session. However, it remains to be seen if the pair continues to gain traction and is able to break through 0.7425-30 strong hurdle amid growing prospects of an eventual Fed rate-hike action, which tends to weigh on higher-yielding currencies - like the Aussie. 

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes, "the daily chart shows that the negative tone persists, given that the pair's recovery stalled well below a bearish 20 DMA, while in the same chart, technical indicators have managed to bounce modestly from near oversold readings, still within bearish territory. In the 4 hours chart, the pair is currently developing a few pips above a modestly bullish 20 SMA, whilst technical indicators turned south, currently challenging their mid-lines, indicating limited buying interest around the pair."