AUD/USD sits near session tops, around 0.8025 level

The AUD/USD pair gained some fresh traction at the start of a new week and was now seen building on its strength above the key 0.80 psychological mark.

The US Dollar's unconvincing recovery move seems to have lost steam in wake of Friday's dismal US retail sales figures for August. Hence, a subdued action around the US Dollar was seen lending some support to pair on Monday. 

This coupled with prevalent positive trading sentiment around commodity space provided an additional boost to commodity-linked currencies and further collaborated to the pair's up-move through early European session.

However, reviving hopes that the Federal Reserve could raise interest rates again in December was seen keeping a lid on any additional up-move for higher-yielding currencies - like the Aussie. 

In absence of any major market moving economic releases from the US, traders are likely to take cues from broader market risk sentiment and the US bond yield dynamics. 

Moving ahead, the RBA meeting minutes, due for release during early Asian session on Tuesday, and the much awaited Fed monetary policy decision on Wednesday would now play key role in determining the pair's next leg of directional move.

   •  USD trend key to AUD story – Westpac

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes: "Shorter term, and according to the 4 hours chart, the upward potential is limited, given that the price is unable to clearly break above a bearish 20 SMA, whilst technical indicators show little directional strength within neutral territory. Some follow-through beyond 0.8035, the immediate resistance and Friday's high is needed to confirm a new leg higher, with scope them to retest the 0.8100 level."