AUD/USD off lows, still in the red below mid-0.7200s

   •    Disappointing Aussie housing market data exerts some fresh downward pressure.
   •  The USD remains supported by Friday’s stellar NFP print/upbeat US ISM PMI.
   •  Downside remains cushioned amid US-China trade optimism and ahead of RBA.

The AUD/USD pair held on to its dismal Aussie data-led weakness, albeit has managed to rebound few pips from a multi-day low level of 0.7223.

The pair extended last week's rejection slide from the very important 200-day SMA and lost some additional ground on Monday following the disappointing release of Aussie housing market data, showing that building approvals fell sharply for the second consecutive month in December. 

The deterioration in housing market conditions was now seen putting pressure on the Reserve Bank of Australia (RBA) to adopt a dovish stance. Hence, the latest RBA monetary policy update, due on Tuesday, will act as a next big trigger for the Australian Dollar.

Meanwhile, the US Dollar remained supported by Friday's stellar headline NFP and upbeat US ISM manufacturing PMI, which further collaborated towards exerting some downward pressure through the Asian session on the first trading day of a new week. 

The downside, however, remained cushioned amid the latest optimism over a possible resolution in the US-China trade disputes, which continues to underpin the China-proxy Aussie and has been one of the key factors behind the pair's recent up-move. 

In absence of any major market moving economic releases, the USD price dynamics might now act as an exclusive driver of the pair's momentum ahead of Tuesday's key event risk - the RBA monetary policy decision. 

Technical levels to watch

Immediate support is pegged near the 0.7225-20 region and is closely followed by the 0.7200 handle, below which the pair is likely to accelerate the slide further towards 0.7160-50 support area. On the flip side, any up-move beyond mid-0.7200s might continue to confront some fresh supply near the 0.7275 region, which if cleared might assist the pair to make a fresh attempt towards clearing the 200-day SMA barrier, near the 0.7295-0.7300 region.