AUD/USD edges lower, but holds above 0.79 handle

The AUD/USD pair edged lower at the start of a new trading week and eroded part of Friday's strong up-move back closer to 2-week tops. 

Concerns over the US political uncertainty seemed to have eased bit and hence, a modest pickup in the US Dollar demand was seen weighing on the major through early European session on Monday. 

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Even the prevalent positive sentiment around commodity space, especially copper, failed to provide any fresh bullish impetus to the commodity-linked Australian Dollar. 

The pair, however, has managed to hold its neck above the 0.7900 handle amid a mildly softer tone around the US Treasury bond yields, which tends to benefit higher-yielding currencies - like the Aussie. 

Meanwhile, reemergence of fresh supply on every up-move clearly seems to suggest that the pair's near-term corrective slide might still be far from over. 

It, however, remains to be seen if bears are able to regain control amid ongoing uncertainty over the US President Donald Trump’s pro-growth economic agenda and fading prospects of a third Fed rate hike action by the end of this year. 

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Technical levels to watch

A follow through weakness back below the 0.7900 handle, leading to a subsequent drop below 0.7880 horizontal support, is likely to accelerate the slide towards 0.7840 intermediate support en-route 0.7815-10 zone. 

On the upside, 0.7940 level now seems to have emerged as immediate supply zone, which if cleared is likely to trigger a short-covering rally and lift the pair beyond 0.7965 intermediate resistance towards the key 0.80 psychological mark.