AUD/USD analysis: bulls have no chances as long as it stands below 0.7250

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7179

Chinese soft growth-related figures sent the AUD/USD pair to fresh 4-week lows.
Trade war headlines may give some temporal support to the Aussie.

The AUD/USD pair finished the week in the 0.7170 price zone, not far from the fresh 4-week low of 0.7150 achieved Friday. After advancing steadily throughout the week, the pair changed course following Chinese data released at the beginning of the day, as it confirmed that the world second largest economy is in an economic slowdown. Chinese Retail Sales increased by 8.1% YoY in November, well below the previous 8.6% or the expected 8.8%. Industrial Production in the same period rose 5.4%, also falling short from the market's expectations of 5.9%, and the previous 5.7%. This Saturday, China released the November House Price Index, up 9.3% vs. the previous 8.5%. There are no macroeconomic figures scheduled in Australia until next Tuesday.

The pair spent the last trading session of the week hovering around the 61.8% retracement of its 0.7020/0.7393 rally at 0.7160, an immediate short-term support and technically poised to extend its decline, as in the daily chart, technical indicators failed to extend their previous advances around their midlines, resuming their decline afterward. The 20 DMA in the mentioned chart heads south around the 38.2% retracement of the mentioned rally at around 0.7250, while the pair was contained by a bearish 100 DMA ever since the week started. In the shorter term, and according to the 4 hours chart the risk is also skewed to the downside, as the pair trades below all of its moving averages, with the 20 SMA accelerating south around 0.7210 as technical indicators resumed their declines following a modest upward correction within negative levels.

Support levels: 0.7150 0.7110 0.7065

Resistance levels: 0.7210 0.7255 0.7300

View Live Chart for the AUD/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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