AUD/USD back below 0.74 mark, hangs closer to three-week lows ahead of ADP report

The AUD/USD pair maintained its offered tone through mid-European session, albeit has held above disappointing Chinese manufacturing PMI-led slide to three-week lows.

Currently hovering around the 0.7400 handle, the pair stalled its recovery move from three-week lows near 0.7420 level and is now headed back towards the lower end of daily trading range, amid persistent greenback buying interest. 

In absence of any fresh fundamental triggers, the latest leg of downslide in the past couple of hours could be attributed to the US treasury bond yields strong performance that underpinned the US Dollar demand and contributed towards driving flows away from higher-yielding currencies - like the Aussie.

Moreover, today's disappointing Chinese manufacturing PMI, which negated upbeat Australian monthly retail sales data, continued weighing on the China-proxy Australian Dollar. This coupled with weaker commodity prices, especially copper, did little to provide any immediate respite. 

   •  Forex Today: AUD tumbles on China PMI, focus on PMIs, ADP

Moving ahead, traders now look forward to the US macro data - ADP report, weekly jobless claims and ISM manufacturing PMI, for some fresh trading impetus, while Friday's NFP would play a key role in determining the pair's next leg of directional move.

Technical levels to watch

Bears would be eyeing for a decisive break through 0.7385 level, below which the pair is likely to accelerate the slide towards 0.7340 support en-route the 0.7300 handle. On the flip, any recovery attempts might continue to confront resistance near 0.7420-25 region, which if cleared might trigger a short-covering bounce towards 0.7455 level (session tops) en-route 0.7475 important hurdle.