AUD/USD adds more than 60 pips on Friday, turns flat for the week above 0.74
- AUD/USD stages a robust recovery on Friday.
- Commodities' upbeat performance provide a boost to the aussie.
- US Dollar Index looks to end the week on a weak note.
The AUD/USD pair started the week under pressure and closed the first three days with losses as the stronger USD and dismal data from Australia weighed. However, on the last day of the week, the pair gained traction and erased all of its weekly losses to turn flat near 0.7440. As of writing, the pair was up 64 pips, or 0.9%, at 0.7442.
The Reserve Bank of Australia published its meeting minutes on Tuesday and failed to help the AUD find demand as it didn't show any potential changes to the monetary policy that would be considered as being hawkish. Furthermore, Westpac Leading Index dropped to -0.2% in May from 0.2% in April to suggest that the economic activity was likely to slow down in the near-term.
On the other hand, the US Dollar Index, which started the week on a positive note as investors remained focused on the Fed's policy stance that suggested two more rate hikes in the remainder of the year, came under a broad-based selling pressure in the last two days. Revived concerns over the United States' trade policy and disappointing data dragged the DXY to a new weekly low of 94.09. As we approach the closing bell, the index is at 94.20, losing 0.4% on the day.
Meanwhile, crude oil prices rallied sharply on Friday amid OPEC's announcements and helped commodity-sensitive currencies stay strong against their peers.
Technical outlook
Following today's upsurge, the RSI indicator on the daily chart rose toward the 50 mark, suggesting that the sellers are losing control of the price action. The immediate resistance for the pair aligns at 0.7500 (psychological level) ahead of 0.7350 (20-DMA/50-DMA) and 0.7580 (Jun. 14 high). On the downside, supports could be seen at 0.7345 (Jun. 21 low), 0.7285 (Jan. 6, 2017, low) and 0.7200 (psychological level).