AUD/USD clings to recovery gains, comfortable above 0.79 handle

   •  USD lacks any follow-through buying interest.
   •  Upbeat Chinese PMI supportive of the rebound.
   •  Surging US bond yields might cap additional gains.

The AUD/USD pair quickly reversed a dip to sub-0.7900 level, over 3-week lows, and managed to rebound around 50-pips from session lows. 

The pair stalled its bearish slide from levels beyond the 0.8100 handle and now seems to have snapped five consecutive days of losing streak. The US Dollar struggled to build on the post-NFP strong rebound and provided some immediate respite for the bulls. 

Adding to this, better-than-expected Chinese Caixin Services PMI, coming in at 54.7 for January as against 53.5 expected, provided an additional boost to the China-proxy Australian Dollar and further collaborated to the pair's recovery from its lowest level since January 12.

It, however, remains to be seen if the pair is able to build on the recovery move or the current bounce is used as an opportunity to initiate fresh short positions amid a follow-through uptick in the US Treasury bond yields, which tends to drive flows away from higher-yielding currencies - like the Aussie. 

Technical levels to watch

Any subsequent up-move is likely to confront immediate resistance near the 0.7960 region, above which the pair seems more likely to dart back towards reclaiming the key 0.80 psychological mark.

On the flip side, sustained weakness below the 0.7900 handle would turn the pair vulnerable to accelerate the slide towards 50-day SMA support near the 0.7870-65 region en-route the 0.7800 round figure mark.