AUD/USD clings to Chinese PMI-led gains beyond 0.7300 handle

The AUD/USD pair extended its strong recovery trend for the third consecutive session and is now building on to momentum back above 0.7300 handle. 

Currently trading around 0.7315 region, the pair on Thursday caught fresh bids after Chinese data showed private services sector picked-up pace in December. In fact, the Caixin services PMI rose to a 17-month high level of 53.4 in December, as compared to 53.1 recorded in November, and lifted the major to its highest level since Dec. 16.

Upbeat Chinese data provided an additional boost to the pair's overnight strong gains led by a slight disappointment from the Fed minutes that showed disinflationary concerns on the back of stronger greenback and that the central bank's projected rate-hikes in 2017 were highly dependent on President-elect Donald Trump's fiscal policies. 

With Fed and Chinese data out of the way, focus now shifts to Thursday US economic docket that features the release of ADP report on private sector employment, usual weekly jobless claims data and ISM non-manufacturing PMI print, and should provide fresh impetus during early NA session. 

Technical levels to watch

Immediate resistance is seen at 0.7325-30 region, which if cleared has the potential to continue boosting the pair further towards 0.7365 horizontal resistance ahead of 0.7400 round figure mark. On the flip side, weakness back below 0.7300 handle might now find support near 0.7280 region below which the pair is likely to head back towards 0.7240 horizontal area, en-route 0.7220 strong support.