AUD/USD renews multi-week highs, closes in on 0.7350

• AUD/USD started the new week on a firm footing.
• US Dollar Index continues to move sideways above 94.00.
• Rising copper prices help AUD gather strength on Monday.

The AUD/USD pair closed the previous week modestly higher and preserved its bullish momentum on Monday. As of writing, the pair was trading at its highest level since mid-September at 0.7344, rising 0.5% on a daily basis.

In the absence of significant fundamental drivers and high-tier macroeconomic data releases, rising copper prices seem to be providing a boost to the commodity-related AUD at the start of the week. Currently, copper futures on COMEX are up 1.5% on a daily basis.

In the meantime, US stocks index futures are down between 0.55% and 0.16% during the European trading hours, suggesting that the cautious market mood could make it difficult for AUD/USD to continue to edge higher in the American session.

At the moment, the US Dollar Index is posting small daily gains at 94.15. The US bond markets will be closed due to the Columbus Day holiday and the risk sentiment is likely to impact the USD's valuation in the second half of the day.

On Tuesday, September HIA New Home Sales and National Australia Bank's Business Confidence data from Australia will be looked upon for fresh impetus. 

AUD/USD near-term outlook

OCBC Bank analysts think that the AUD/USD pair could target 0.7400 next after managing to close the previous week above 0.7300.

"ACGBs has underperformed USTs in run higher in yield, providing some additional support for the AUD beyond risk sentiment," analysts added.

AUD/USD set to pounce the 0.7400 level – OCBC.

Technical levels to watch for