AUD/USD flirting with 100-DMA support, seems vulnerable

   •  Bulls fail to preserve overnight recovery gains. 
   •  Softer USD fails to lend any support.
   •  Technically seems poised to slide further.

The AUD/USD pair came under some renewed selling pressure on Wednesday and hangs closer to near 4-week lows, set in the previous session.

Currently flirting with 100-day SMA, near the 0.7870-65 region, reversing all of its previous session's modest recovery gains, today's downfall lacked any fresh fundamental catalyst and has happened despite a mildly softer US Dollar. 

A weaker trading sentiment around copper prices, along with a modest pickup in the US Treasury bond yields is turning out to be key factors weighing on commodity-linked/higher-yielding currencies - like the Aussie. 

Bulls struggled to preserve overnight recovery move further beyond the 0.7900 handle and the price-action now seems to suggest that the near-term corrective slide might be still far from being over. 

There aren't any major market-moving economic data due for release on Wednesday and hence, a follow-through weakness, led by some technical selling below 100-DMA support, now looks a distinct possibility.

Technical outlook

Omkar Godbole, Analyst and Editor at FXStreet writes: “The retreat from 0.7910 to 0.7877 adds credence to the downward sloping (bearish bias) 5-day MA and 10-day MA and also signals the failure to hold above the 5-day MA and 0.7893 (38.2% Fib R of Dec-Jan rally).”

“A rebound from the upward sloping 50-day MA and a close above 0.7893 (38.2% Fib R of Dec-Jan rally) would open doors for a test of supply around 0.80” he further added.