AUD/USD extends recovery from one-week lows, further beyond 0.79 level

Having posted a session low level of 0.7885, the AUD/USD pair regained traction and is now seen building on previous session's recovery move from one-week lows.

The pair had good two-way volatile moves on Thursday, dropping to a 6-day low level near the 0.7865 region before clawing back to finally settle nearly unchanged for the session. The recovery move was supported by the release of disappointing US existing home sales data, which failed to assist the US Dollar to preserve early recovery gains. 

A subdued greenback price action helped the pair to catch some fresh bids on Friday. This coupled with the prevalent positive trading sentiment around commodity space, especially copper, remained supportive of the bid tone around commodity-linked currencies, including the Australian Dollar. 

Meanwhile, possibilities of short unwinding, ahead of a key speech by the Fed Chair Janet Yellen at the much awaited Jackson Hole Symposium, might have also collaborated to the pair's modest uptick through early European session. 

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Ahead of the big event risk, traders will get a chance to respond to the latest US Durable Goods report, due for release during early NA session. 

Technical levels to watch

Immediate resistance is pegged near 0.7940 level, above which a fresh bout of short-covering could assist the pair to dart back towards reclaiming the key 0.80 psychological mark. On the flip side, sustained weakness back below the 0.7900 handle would turn the pair vulnerable to retest 0.7870-65 important horizontal support before eventually dropping to 0.7830-25 strong support.