AUD/USD struggles to stage a convincing rebound, trades near 0.7500
- AUD/USD stays in the negative territory following Monday's recovery.
- US Dollar Index edges higher ahead of FOMC Chairman Powell's testimony.
- Commonwealth Bank PMI data will be featured in Australian economic docket.
The AUD/USD pair snapped a four-day losing streak and registered modest gains on Monday but lost its traction on Tuesday. As of writing, the pair was down 0.4% on a daily basis at 0.7505.
DXY clings to daily gains
The broad-based USD weakness allowed AUD/USD to erase a small portion of last week's losses on Monday. The US Dollar Index (DXY), which gained 2% on the back of the FOMC's hawkish shift, lost 0.5% at the start of the week but managed to regather its bullish momentum.
Ahead of FOMC Chairman Jerome Powell's testimony before the House Select Subcommittee on the Coronavirus Crisis at 1800 GMT, the DXY is up 0.3% on the day at 92.11. Investors will keep a close eye on Powell's remarks regarding the inflation outlook and the timing of tapering.
May Existing Home Sales and the Federal Reserve Bank of Richmond's Manufacturing Index for June will be looked upon for fresh catalysts as well. On the other hand, the Commonwealth Bank will release the preliminary Manufacturing and Services PMI reports for Australia in the early trading hours of the Asian session on Wednesday.
In the meantime, Wall Street's main indexes remain on track to open modestly higher on Tuesday, suggesting that the greenback could have a tough time gathering additional strength during the American session.
Technical levels to watch for