AUD/USD Current price: 0.7407
- Chinese manufacturing growth slowed, could hit the AUD.
- AUD/USD strong resistance at 0.7440, upward chances increase beyond it.
The AUD/USD pair edged sharply higher on Friday and settled at 0.7407, anyway down weekly basis. The Aussie found support on a broadly weaker dollar, hit by profit-taking and the better performance of worldwide equities. Over the weekend, Chinese data came in softer-than-expected, as the official PMI showed that the growth in the manufacturing sector slowed in June, probably due to escalating trade tensions with the US. The index came in at 51.5 from the previous 51.9. The non-manufacturing index for the same month, came in as expected at 55.0. In the meantime, the US is moving on with tariffs on Chinese goods and tariffs on $34 billion in goods should become effective this Friday. Australia will start the week releasing the AIG performance of manufacturing index, latest seen at 57.5, while China will offer the Caixin manufacturing PMI seen at 51.0 from the previous 51.1. Risk aversion and soft Chinese data are set to undermine the Australian currency. The daily chart shows that technical indicators have bounced from oversold readings, maintaining their upward slopes but well below their midlines, while the price is far below all of its moving averages, maintaining the risk skewed to the downside. In the 4 hours chart, the pair is now above a flat 20 SMA, while indicators aim higher within positive territory, supporting additional gains at least toward 0.7440, the immediate resistance.
Support levels: 0.7380 0.7345 0.7310
Resistance levels: 0.7440 0.7475 0.7510
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