AUD/USD targets 0.7700 on upbeat China CPI?

The Aussie remains strongly bids and flirts with daily tops following the release of better-than expected Chinese CPI and PPI reports for the month of January. China CPI data arrived at 2.5% y/y vs 2.4% expected and prev 2.1%, while PPI for Jan came in at 6.9% y/y vs 6.5% exp. and 5.5% last.

AUD/USD also benefits from upbeat business confidence data released earlier on the day, although it remains to be seen whether the bulls can make its way to conquer 0.77 handle, as the treasury yields appear to have picked-up strength, lifting the bids for the USD across the board.

Markets now look forward to the US PPI data and Fed Chair Yellen’s Congressional testimony due later today for fresh incentives on the major.

AUD/USD Levels to watch   

At 0.7656, the pair finds the immediate resistance at 0.7699 (multi-week high) above which gains could be extended to the next hurdle located 0.7750 (psychological levels) and 0.7773 (Nov 9 high). On the flip side, the immediate support located at 0.7647/45 (1h 200 & 100-SMA). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7600 (round figure) and below that 0.7570 (Feb 2 low).