AUD/USD Analysis: no mercy for the Aussie

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6807

Australian Retail Sales seen up by 0.3% in June.
Trump surprise move on China triggered risk-aversion.
AUD/USD fell for a tenth consecutive day, no signs of a bottom.

The Australian dollar pierced the 0.6800 level against its American rival, falling to 0.6794, declining for a tenth consecutive day as the escalation of the trade war overshadowed it all. Following Fed’s decision to proceed with a preventive 25bps rate cut, the US President indicated that he would apply a 10% tariff on $300bn of additional Chinese goods starting September 1. The movement seems to be meant to force Fed’s hand, as Chief Powell said that trade tensions were one of the reasons that pushed policymakers into their latest decision.

Earlier in the day, Australia released the AIG Performance of Manufacturing Index which came in at 51.3, better than the previous 49.3, while the Commonwealth Bank Manufacturing PMI for July resulted at 51.6, better than the 51.4 forecasted. The country will release PPI data for Q2 and June Retail Sales during the upcoming Asian session, this last seen up by 0.3% MoM.

AUD/USD short-term technical outlook

The AUD/USD pair is battling around the 0.6800 figure, offering a bearish stance in the short-term, as, in the 4 hours chart, an early attempt to regain the upside was again rejected by sellers aligned around a bearish 20 SMA. Furthermore, technical indicators resumed their declines within negative levels, now heading firmly lower in oversold territory. Below 0.6790, the decline could continue toward the 0.6720/30 price zone.

Support levels: 0.6790 0.6760 0.6725

Resistance levels: 0.6820 0.6850 0.6885

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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