AUD/USD recovers Thursday's losses, clings to gains above 0.74

The AUD/USD pair quickly gained 30 pips following the nonfarm payroll report from the U.S. After the initial upsurge, the pair eased towards 0.74 and caught some fresh bids again. As of writing, the pair is trading at 0.7430, up 0.75% on the day.

The pair's advance is being fueled by the broad-based selling pressure seen on the greenback in the NA session. Following the nonfarm payroll data, which came in at 183K in May and missed the market expectation of 185K, the trade balance, and ISM New York Index both were disappointing as well. After dropping below the 97 handle, the US Dollar Index has been struggling to make a recovery and is now at 96.75, down 0.43% on the day.

• US: Total nonfarm payroll employment increased by 138,000 in May
• US: Goods and services deficit was $47.6 billion in April, up $2.3 billion from $45.3 billion in March
• ISM New York Index eased to 46.7 from 55.8 in May

If the pair extends its recovery to mid-074s, it will turn flat on the week, retracing all of its losses. However, this also means that the pair has been struggling to determine a short-term direction.

Technical outlook

The RSI on the daily graph is moving closer to the 50 level, suggesting that the short-term bearish pressure continues to fade. The initial hurdle for the pair could be seen at 0.7500 (psychological level) ahead of 0.7560 (20-WMA) and 0.7610 (Apr. 17 high). On the downside, supports are located at 0.7375 (daily low), 0.7330 (May 9 low) and 0.7285 (Jan. 6 low).