AUD/USD Current price: 0.7624
- Australian business conditions at 20-year highs.
- Chinese economic deceleration worrisome for AUD longs
The Australian dollar managed to recover ground against the greenback, bouncing from a 4-month low of 0.7609 after a local index indicated a better performance for the economy. The NAB's business conditions indicator for October rose to 21, a record high since the index began in 1997. Business confidence remained unchanged at 8 after September figure was upwardly revised. The AUD/USD pair saw a limited advance, as Chinese disappointing data weighed on the Aussie. According to official releases, China's retail sales rose by less-than-expected in October, up 10% against previous 10.3% while Industrial Production increased by 6.2%, missing expectations of 6.3% and below previous 6.6%. In the meantime, the greenback trades with a soft tone against its major rivals ever since the European opening. Pending of release, are US PPI figures for October.
From a technical point of view, the intraday recovery is little relevant within the dominant bearish trend, as the pair topped right below 0.7640, and struggles around the previous two months' lows in the 0.7625 region, unable to accelerate beyond the level. Shorter term, and according to the 4 hours chart, the risk remains towards the downside, as the price is developing below a bearish 20 SMA, while technical indicators entered a consolidative phase right well into bearish territory. The mentioned 20 SMA stands at 0.7660, the immediate resistance, followed by 0.7695, where selling interest has contained rallies the last two weeks. Below 0.7610, the pair has scope to extend its decline initially to 0.7570, where it has a couple of daily lows from early July, followed later by 0.7535.
Support levels: 0.7610 0.7570 0.7535
Resistance levels: 0.7660 0.7695 0.7730
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