AUD/USD off lows, still weaker around 0.79 handle

The AUD/USD pair recovered majority of its early lost ground to one-week lows, albeit was seen struggling to build on the move further beyond the 0.7900 handle. 

The US Dollar held with modest gains on Thursday and dragged the pair sharply lower by around 40-45 pips to session lows near the 0.7865 region during the early European session. 

The fall was quickly bought into and the pair recovered back to Asian session consolidative range. The sharp recovery move was supported by the prevalent positive sentiment around copper prices, which underpinned demand for commodity-linked currencies, including the Australian Dollar.

Bulls, however, seemed lacking conviction amid a modest uptick in the US Treasury bond yields, which was seen capping further up-move for higher-yielding currencies - like the Aussie.

Moreover, traders also seemed reluctant to carry/initiate aggressive bets in anticipation of any hawkish hits from the Fed Chair Janet Yellen, during her speech at the much anticipated Jackson Hole Symposium.

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Technical levels to watch

Any subsequent recovery beyond the 0.7900 handle is likely to confront resistance near 0.7915 level, above which a bout of short-covering could lift the pair back towards 0.7950-60 strong supply zone. 

On the flip side, weakness back below 0.7875 level would now turn the pair vulnerable to accelerate the slide towards 0.7825-20 horizontal support en-route 50-day SMA near the 0.7800 handle.