AUD/USD remains near daily highs as dollar sell-off persists

The AUD/USD renewed its session high at 0.7436 at the beginning of the NA session before easing back a little. As of writing, the pair was trading at 0.7430, up 0.23%, or 17 pips, on the day, and poised to extend its gains as the greenback continues to face a heavy selling pressure.

Earlier in the day, the pair dropped below the 0.74 mark after the RBA released its latest meeting's minutes, which highlighted that the bank was concerned about the housing market bubble. After touching its session low at 0.7394, it didn't take long for the pair to recover back above the 0.74 handle.

• RBA minutes: Developments in the labour and housing markets warrant careful monitoring

As the American traders hit their desks, another USD selling wave came about after the U.S. housing data disappointed the markets, with both the Building Permits Change and the Housing Starts Change recording contractions in April. Although the next data showed that the Industrial Production expanded 1% in April, the greenback failed to take advantage. As of writing, the US Dollar Index was at 98.11, a tad above its session, or 6-month low of 98.06, losing 0.7% on the day.

Technical outlook

The initial hurdle for the pair aligns at 0.7440 (20-DMA) ahead of 0.7500 (psychological level) and 0.7540 (200-DMA). On the downside, supports could be seen at 0.7400 (psychological level), 0.7330 (May 9 low) and 0.7285 (Jan. 6 low).

• AUD/USD recovery is corrective only – Commerzbank
• The Australian dollar's outlook darkens - BBG