AUD/USD: Recovery remains capped below 0.7750

• Ignores relief rally in Iron ore and Copper futures.
• Easing Chinese industrial profits undermines the Aussie.
• US CB Consumer confidence to offer near-term trading impetus?

The AUD/USD pair is seen facing fresh offers on the European open, despite the risk-on rally seen in the European equities amid receding US-China war fears.

More so, the Aussie ignores the ongoing rally in Dalian iron futures and Copper prices on Comex, as the sentiment remains weighed down by the slowdown in the Chinese industrial profits data, with the European traders hitting their desks and reacting negatively to the dismal Chinese macro news.

Additionally, the latest declines in the spot can be also attributed to the sell-off in the USD/CNY cross, especially after the People’s Bank of China (PBOC) strengthened the Yuan to the strongest levels since August 2015.

In the day ahead, the pair will look forward to the sentiment on the Wall Street and the US CB consumer confidence data for fresh trading momentum.

AUD/USD levels to watch

According to FXStreet’s Analyst Omkar, “A daily close above 0.7784 (March 22 high) would signal a bottom is in place at 0.7672 (March 21 low) and could yield a sustained rally to 0.7868 (50-day MA) and 0.7916 (March 14 high). On the downside, breach of support at 0.7712 (March 1 low) would open doors for 0.7672 (March 21 low) and 0.7654 (Dec. 5 high).”