AUD/USD pushes higher to new weekly top at 0.7440 as DXY retreats to 95

• As expected, the RBA leaves policy rate unchanged at 1.5% on Tuesday.
• CNY strength lifts the AUD.
• US Dollar Index loses traction and returns to 95 on Tuesday.

The AUD/USD pair didn't show a significant reaction to the RBA's interest rate decision and the accompanying monetary policy statement during the Asian session and moved sideways below the 0.74 handle. However, a sharp drop witnessed in the USD/CNY pair helped the aussie gather strength against the buck. After breaking above the 0.74 mark, the pair continued to edge higher and refreshed its weekly top at 0.7440 in the last hour. As of writing, the pair was trading at 0.7432, adding 0.6% on the day.

Commenting o today's RBA event, "the Governor does not provide a convincing commentary that wage pressures can be expected to lift; the housing slowdown and the associated wealth effect will not be headwinds for the economy; any evidence that inflation pressures are likely to build; and why global developments are not pointing to some challenges for Australia," Westpac analysts said in a recently published report.

Meanwhile, the US Dollar Index, which rose to its highest level since late June at 95.52 on Monday, is staging a technical correction on Tuesday amid a lack of fundamental drivers that could help the buyers stay in control. At the moment, the index is down 0.32% on the day at 95.05. Later in the NA session, JOLTS Job Openings and IBD/TIPP Economic Optimism Index will be released from the United States.

The Australian economic docket on Wednesday will feature Westpac Consumer Confidence and home loans figures.

Technical outlook

The pair could face the first resistance at 0.7440 (Jul. 31 high(daily high) ahead of 0.7500 (psychological level/100-DMA) and 0.7575 (Jun. 14 high). On the downside, supports align at 0.7410 (50-DMA), 0.7370 (Aug. 6 low) and 0.7315 (Jul. 20 low).