AUD/USD consolidates daily losses, continues to hold above 0.78 handle

The AUD/USD pair, which eased to a fresh session low at 0.7818 in the European morning, started to retrace its losses as the greenback struggled to preserve its strength. As of writing, the pair was trading at 0.7833, still down 0.15% on the day.

After edging higher to a 9-day top at 93.65, the US Dollar Index lost traction amid weaker-than-expected macroeconomic data from the U.S. and erased a portion of its daily upside. According to the data released jointly by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, privately-owned housing starts in September contracted 4.7% on a monthly basis. Moreover, building permits dropped 4.5% during the same period. At the moment, the DXY is at 93.48, losing 0.12% on the day.

• US: Housing starts in Sept were at 1,127,000, 4.7% below August estimate of 1,183,000

Later in the session, the Fed is going to release its Beige Book, which provides a detailed picture of the overall US economic activity and the outlook. An optimistic view could help the greenback start rising against its peers and weigh on the pair.

Technical outlook

The RSI indicator on the daily graph remains below the 50 mark, suggesting that the pair is unlikely to stage a recovery in the near-term. On the upside, resistances align at 0.7870 (100-DMA), 0.7915 (50-DMA) and 0.7975 (Sep. 25 high). On the flip side, supports could be seen at 0.7820 (daily low), 0.7750 (Oct. 9 low) and 0.7700 (psychological level). 

• AUD/USD could slip back to 0.7766 – Commerzbank