AUD/USD Analysis: inflation data weighed the Aussie lower
|AUD/USD Current Price: 0.7118
- Chinese March trade figures to set the tone for the Aussie.
- AUD/USD trapped in a well-defined range since early March.
The AUD/USD pair retreated sharply from the upper end of its March/April range, ending the day around 0.7120 after hitting 0.7174 following the release of the latest FOMC Meeting's Minutes. The Aussie came under pressure after Australian Consumer Inflation Expectations declined to 3.9% in April, compared to 4.1% in the prior month. China released March inflation, which rose to 2.3% YoY, its highest in five months but slightly below the market's expectations, while monthly CPI declined by 0.4%, worse than the -0.2% forecasted. Dollar's broad strength did the rest, alongside the soft tone of US indexes. Friday will start with the release of the RBA's Financial Stability Report, and March China trade data. Given that China is Australia's largest trading partner, the numbers tend to have a strong effect on AUD crosses.
The AUD/USD pair lost its positive momentum, and the 4 hours chart suggest that the decline may continue during the upcoming sessions, given that the price broke below its 20 SMA, which lost its upward strength and turned flat. Technical indicators in the mentioned chart entered negative territory, losing part of their downward momentum but maintaining their downward slopes, in line with further slides ahead.
Support levels: 0.7090 0.7060 0.7025
Resistance levels: 0.7170 0.7205 0.7245
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