AUD/USD hit fresh 4-month high at 0.8081 and retreats modestly

• AUD/USD off highs, still sharply higher for the day. 
• Aussie heads for highest daily close since May 2015. 
• US Dollar bearish pressure eases as equity prices in Wall Street move off highs. 

The AUD/USD pair pulled back after reaching a fresh 4-month high at 0.8081.  It dropped to 0.8060 and it was trading at 0.8065, up 0.87% for the day and 3.35% from the level it closed last year. 

The US dollar trimmed a small portion of its losses. It is still sharply lower. The US Dollar Index broke below 90.00 and bottomed at 89.24, the lowest since 2014. Comments from US Treasury Secretary Mnuchin from Davos favored an acceleration of the decline. US economic data failed to offer support to the greenback. 

For Thursday there are no scheduled releases in Australia while markets will be closed on Friday due to the Australia Day holiday. In the US, the next key report will be on Friday with the first estimate of Q4 GDP.

The greenback remains under pressure supporting AUD/USD. The pair is headed toward the highest close since May 2015 and is looking at 0.8100 and to the 2017 high of 0.8124. 

AUD/USD Technical levels

If the correction extends, immediate support could be seen at 0.8035/40 (Jan 19 high), followed by 0.8005 and 0.7975 (Jan 22 low). To the upside, before the 0.8100 psychological obstacle, the pair might face resistance at 0.8080/85 (Jan 24 high).