AUD/USD recovers to move back above 0.7400 handle

The AUD/USD pair reversed from session high level of 0.7473 and dropped below 0.7400 handle on talks of PBOC allowing the Yuan to devalue further. 

The pair, however, has recovered from session low of 0.7371 to currently trade back above 0.7400 handle, consolidating below 100-day SMA. The pair on Wednesday's advanced for second consecutive day and recovered nearly 150-pips from Brexit led swing low of 0.7300.

Ongoing political and economic uncertainty surrounding the Brexit vote is supporting the safe-haven demand for the greenback on Thursday and weighing on commodities and commodity-linked currencies - like the Aussie. 

On the economic data front, traders will look forward to US weekly jobless claims and Chicago PMI data, scheduled later during NA session.

However, main focus would be Friday's release of Chinese manufacturing PMI for the month of June. Being Australia's largest trading partner, Chinese economic data, especially from the manufacturing sector, has a lasting effect on the Australian Dollar.

Technical levels to watch

Recovery momentum back above 100-day SMA immediate resistance near 0.7435 region now seems to assist the pair to extended it recovery 0.7500 psychological mark resistance. Sustained trade above 0.7500 region seems to further boost the pair and move back towards pre-Brexit level of 0.7600.

Alternatively, drop back below 0.7400 handle might now take support around 0.7360 level, below which the pair seems all set to break below 0.7300 level, Brexit swing low, and head towards testing the very important 200-day SMA support near 0.7280 region.