FxWirePro: AUD/USD edges higher from session lows, renewed US-China trade optimism lends support

AUD/USD chart - Trading View 

AUD/USD was trading largely unchanged at 0.7741 at around 04:10 GMT, edging higher from session lows at 0.7723.

The Australian dollar remains supported as risk sentiment improves amid renewed US-China trade optimism. 

On the other side, US dollar eases amid risk-reset, DXY was struggling to extend previous session's weakness, slipped lower from session highs at 90.17.

AUD/USD has been extending sideways along 55-EMA support and the trend is likely to continue as technical studies show a neutral bias.

Also, further upside in the pair appears elusive amid Victoria lockdown news. Uptick in the covid infections led to imposition of 7-day lockdown in the second-largest state of Victoria.  

On the data front, Australia’s Q1 Private Capital Expenditure jumped 6.3%, beating the 2.0% market consensus and 3.0% previous readouts.

Further, China's Industrial Profits eased to 57.0%,  below 92.3% YoY previous readouts in April. Mixed data failed to impress Aussie bulls.

Focus now on the US Durable Goods Orders for April and Weekly Jobless Claims  for further direction. 

Support levels - 0.7729 (55-EMA), 0.7681 (Lower BB), 0.7659 (110-EMA)

Resistance levels - 0.7759 (20-DMA), 0.7769 (Cloud top), 0.78

Summary: AUD/USD extends choppy rangebound trade between 20-DMA and 55-EMA. Breakout above will determine near-term direction. Risk sentiment and covid headline could also influence price action.