AUD/USD - 0.80 is so close yet so far

The rebound from the 1-hour 200-MA in the AUD/USD gathered traction on the dismal US core PCE and employment cost index data, although the resilience in the treasury yields made sure the 0.80 handle is not put to test. 

AU-US 10-yr spread remains unchanged

The spread between the Australia 10-yr government bond yield and the US 10-yr Treasury yield remains unchanged around 40 basis points following the release of the US data. The dismal inflation figures were countered by strong consumption numbers, thus treasury yields remain flat lined. The 10-yr yield was last seen trading unchanged on the day at 2.32%. 

The spot did rise to a high of 0.7994 only to trim gains to trade below 1-hour 50-MA level of 0.7981. Gold prices are up 0.30% at $1264/Oz levels and that could keep the Aussie well bid heading into the weekend. 

A break above 0.80 handle could be seen if the Michigan Consumer Sentiment Index for July registers a bigger-than-expected drop. 

AUD/USD Technical Levels

A weekly close above 0.7983 (weekly 200-MA) would open doors for a sustained rally to 0.8071 (weekly 50-MA) and 0.81 handle. On the lower side, support is seen at 0.7961 (5-DMA), which, if breached would expose 0.7934 (10-DMA) and 0.79 (zero levels). The 5-DMA and 10-DMA are still sloping upwards; suggesting dips could be short lived.