AUD/USD up little, remains capped below 200-DMA barrier

   •  USD fails to benefit from the passage of US tax cut bill. 
   •  Surging US bond yields now seemed to cap gains.
   •  A clear breakthrough 0.77 handle needed for bullish confirmation.

The AUD/USD pair extended its consolidative price-action and rebounded from 5-day old trading range support on Wednesday. 

The latest leg of uptick over the past hour or so lacked any catalyst and could be attributed to a subdued US Dollar price action. Despite the latest optimism over the long-awaited tax cut legislation, the greenback has failed to gain any positive traction and provided a minor lift to the pair.

However, the ongoing upsurge in the US Treasury bond yields might continue capping additional strong gains for higher-yielding currencies - like the Aussie. 

Moreover, the pair has been facing difficulty in building on last week's strong recovery move from over 6-month lows and every attempted up-move towards the very important 200-day SMA hurdle, around the 0.7700 handle, is being sold into. 

Hence, it would be prudent to wait for a sustained break through the mentioned barrier before committing to any additional appreciating move in the near-term. 

Later during the NA session, existing home sales data from the US would now be looked upon for some fresh trading impetus. In the meantime, the USD and the US bond yield dynamics would remain key determinants of the pair's momentum.

Technical levels to watch

Immediate hurdle remains near the 0.7685-95 region, above which the pair is likely to dart towards 0.7730 supply zone en-route mid-0.7700s. On the flip side, the 0.7650-40 region now seems to have emerged as immediate support, which if broken could accelerate the slide back towards the 0.7600 handle.