AUD/USD eases below 0.78, remains on track to end seventh straight day higher

• Copper futures extends rally on Thursday.
• DXY looks to close the day at 3-month lows.
• AUD/USD up more than 200 pips in December.

The AUD/USD pair advanced above the 0.78 for the first time since late October on Thursday and staged a corrective slide before going into a consolidation phase in the NA session. As of writing, the pair was trading at 0.7794, gaining 30 pips, or 0.35% on the day.

The pair's modest rally in the last week of December had been fueled by a strong overall performance of commodity-sensitive currencies and a weakening greenback. Copper futures on Thursday surged to the highest level since February of 2015 at 3.321, boosting copper-exporter Australia's dollar. Investors are pricing the expectations of the global copper demand increasing in 2018 amid a robust and broad-based economic recovery.

On the other hand, the buck remains on track to close the last week of 2017 weaker against its rivals as investors are liquidating their positions and moving to the sidelines before they see the impact of tax cuts on the economy and the Fed's monetary policy next year. After refreshing its three-month low at 92.27, the DXY stabilized around 92.30, where it was losing nearly 0.4% on the day.

With no macroeconomic data releases in the last trading of 2017, the pair is likely to stay in a tight range on Friday. 

Technical outlook

The RSI indicator on the daily graph stays above the 70 mark for the second day in a row, suggesting that the pair is technically overbought and could correct its recent gains before rising further. On the upside, the initial resistance aligns at 0.7810 (daily high) ahead of 0.7885 (Oct. 19 high) and 0.7965 (Sep. 24 high). On the downside, supports are located at 0.7755 (100-DMA), 0.7720 (200-DMA) and 0.7650 (Dec. 21 low).

Today's data from the U.S.

• US: Weekly initial claims was 245,000, unchanged from previous week
• US: Wholesale inventories for November $610.2 billion, up 0.7% from October 2017
• US: International trade deficit was $69.7 billion in November, up $1.6 billion from October
• Chicago PMI advances to best level since March 2011 at 67.6 in December