AUD/USD sits at session tops near mid-0.7900s

After Friday's sharp pullback, the AUD/USD pair regained traction at the start of a new week and is now inching back closer to 26-month highs touched last week. 

Currently trading around mid-0.7900s, the pair continued scaling higher through early European session despite a modest US Dollar recovery. Traders even shrugged off the prevalent positive tone around the US Treasury bond yields, which tend to drive flows away from higher-yielding currencies - like the Aussie. 

Meanwhile, the recent rebound in commodity prices, especially copper and gold continued underpinning the sentiment surrounding commodity-linked currencies and is turning out to be an exclusive driver of the pair's up-move back closer to the highest level since May 2015 touched last Thursday. 

It, however, remains to be seen if the pair is able to build on the up-move or once again fails to conquer the key 0.80 psychological mark ahead of the next big event risk - FOMC decision on Wednesday.

Today’s US economic docket features the release of flash PMI print and existing home sales data, which would be looked upon for to grab some short-term trading impetus later during the NA session.

Technical levels to watch

Bulls would be eyeing for a clear break through 0.7990-0.8000 immediate strong hurdle, above which the pair is likely to extend the near-term strong bullish trajectory towards 0.8025-30 intermediate resistance en-route 0.8075-80 region.

On the flip side, 0.7915-10 area now seems to protect the immediate downside, which if broken would turn the pair vulnerable to break below Friday’s swing lows support near 0.7875 level and head towards testing its next support near 0.7830-25 zone.