AUD/USD struggling to capture 0.77, upside potential draining away

• Bearish trend is still in play for the Aussie, capping gains as market sentiment weighs.
• US Dollar revival, surging market fears over a trade war continue to expose the AUD/USD to downside weakness.

The AUD/USD opens the new week trading near 0.7685, after failing to capture and hold the 0.7700 handle last Friday. Monday's Asia session is likely to suffer from thin volumes with the Aussie and Kiwi markets both shuttered for the Easter Monday holiday, and a lack of notable data for the Aussie could leave action constrained, though Taikan Manufacturing Outlook figures for Japan at 23:50 GMT late Sunday and the Caixin Manufacturing PMI for China at 01:45 GMT early Monday could produce some knock-on volatility, with both the Taikan Manufacturing Index and the Caixin Manufacturing PMI expected very close to their previous figures, at 25 and 51.7 respectively.

The Aussie hasn't been able to capture much bullish motivation lately, and the AUD is still stuck in a declining pattern against the USD as the Greenback goes through brief sprints of recovery in the broader markets. Non-Farm Payrolls will be dropping at the end of the week, and the effect could be notably large with an extra focus on US wage growth figures as the US Fed prepares for further rate increases in the calendar year. 

Trade war tensions settled back last week as both China and the US seemed willing to meet in the middle and negotiate out of the tariff-lead mess, but a damper is likely to drop on market sentiment following China's announcement of immediate tariffs targeting US goods that were announced late in the weekend.

AUD/USD Levels to consider

The technicals are holding roughly in place as the pair drifted into the weekend, and as FXStreet's own Valeria Bednarik noted, "the daily chart shows that the dominant bearish trend remains firm in place, as the 20 DMA extended its decline now a few pips above 0.7740, a major resistance, as the level stands for the 61.8% retracement of the December/January rally, while technical indicators in the mentioned time frame hold near oversold readings, with no signs of downward exhaustion. Shorter term, and according to the 4 hours chart, the pair could extend its latest upward correction, as it settled a couple of pips above a bearish 20 SMA, while technical indicators aim higher, with moderated strength, around their mid-lines, not enough, however, to suggest a bottom has been reached."

Support levels:  0.7645 0.7610 0.7575

Resistance levels: 0.7695 0.7740 0.7785