AUD/USD bulls eye 0.7165 hurdle as greenback stays pressured amid pre-Fed trading lull

• AUD/USD prints two-day rebound during a lackluster Asian session.
• Aussie Retail Sales came in positive but holidays in Japan, China, softer PMIs test buyers.
• Fed’s widely expected moves, also priced in, keep pair buyers hopeful.
• US macros, risk catalysts and yields can offer intermediate moves.

AUD/USD picks up bids to refresh intraday high around 0.7125 ahead of Wednesday’s European session. In doing so, the Aussie pair extend the previous day’s recovery moves amid a broadly softer US dollar during sluggish momentum.

The US dollar seems to bear the burden of a pullback in the US Treasury yields, portrayed on Tuesday, as well as hoes that the US Federal Reserve (Fed) won’t adhere to any major surprises that could propel the greenback.

Additionally favoring the AUD/USD prices could be the firmer Australia Retail Sales data for March, actual 1.6% versus 0.6% forecast and 1.8% prior.

It should be noted that an absence of Chinese and Japanese traders restricts the bond market moves during the Asian session, which in turn allows the AUD/USD bears to consolidate recent losses around a three-month low.

Moving on, the pair’s recent buying is likely to continue in a phased manner ahead of the US session, wherein the US ISM Services PMI and ADP Employment Change, as well as geopolitical and covid-linked headlines, could entertain AUD/USD traders. Above all, how the Fed takes a big leap to tame inflation and still rejects economic fears will be an interesting case to watch.

Read: Fed expected to raise rates by 50bps, but guidance is expected to be key

Technical analysis

A clear upside break of the two-week-old resistance line, now support around 0.7040, keeps AUD/USD buyers hopeful to aim for March’s low of 0.7165.