AUD/USD analysis: at risk of losing 0.7000
|AUD/USD Current price: 0.7020
- Thin market conditions expected with only Australian markets opened today.
- AIG Performance of Manufacturing Index for December up next.
The AUD/USD pair settled at around 0.7040 Monday, under pressure despite the good performance of Wall Street and broad dollar's weakness. The pair found some support early Monday on positive comments from US President Trump about the trade war, as he tweeted that, "Just had a long and very good call with President Xi of China. Deal is moving along very well. If made, it will be very comprehensive, covering all subjects, areas and points of dispute. Big progress being made!" Nevertheless, Aussie gains were capped by more signs of economic slowdown in China, as manufacturing activity fell into contraction territory in December, according to the official PMI, which fell to 49.4. The non-manufacturing index improved in the same month, up to 53.8 from 53.4 in November. Australian markets will be open, and the country will release the AIG Performance of Manufacturing Index for December, and the RBA Commodity Index for the same month.
The pair trades not far from its yearly low of 0.7016 and poised to break it lower. Short-term, and according to the 4 hours chart, the pair is neutral-to-bearish, hovering around a flat 20 SMA, currently at 0.7046, while technical indicators head nowhere around their midlines. In the same chart, the 100 and 200 SMA maintain their bearish slopes well above the current level, indicating that any uptick will likely be temporal and a chance to sell higher. The bearish momentum is set to accelerate on a break below 0.6990.
Support levels: 0.7015 0.6990 0.6950
Resistance levels: 0.7080 0.7110 0.7140
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