AUD/USD slides to session lows, closer to 0.78 handle

The AUD/USD pair maintained its offered tone through mid-European session and is now headed back towards weaker Aussie retail sales data-led swing lows.

Today's worse than expected retail sales figures, posting biggest fall since March 2013, negated a better-than-expected trade surplus data and attracted heavy selling pressure around the Australian Dollar. 

   •  Australia: Dismal August retail sales report - ING

The selling pressure abated for the time being amid lack of any strong follow through US Dollar buying interest, despite yesterday's upbeat ADP report and ISM non-manufacturing PMI.

A mildly softer tone around the US Treasury bond yields have failed to provide any additional boost to the greenback's recent rally and helped limit deeper losses for higher-yielding currencies - like the Aussie. 

Focus now shifts to the US economic docket, featuring the release of weekly jobless claims, trade balance and factory orders data, which along with the Fedspeaks would be looked upon for fresh trading impetus. 

Technical levels to watch

Immediate support is pegged near the 0.7800 handle and is closely followed by 100-day SMA support near the 0.7780 region, below which the pair is likely to accelerate the fall towards its next support near 0.7730-25 zone.

On the upside, 0.7850-60 area now seems to act as immediate resistance, which if cleared might trigger a short-covering rally even beyond the 0.7900 handle back towards 50-day SMA hurdle near the 0.7930-35 region.