AUD/USD can't hold onto 0.7100 as China GDP comes over the horizon

The Aussie camp sees downside risks coming into focus on Friday.
China's GDP data is expected to show slowing growth, boding poorly for Asian markets' risk appetite.

The AUD/USD is trading firmly into the downside heading into Friday's overnight session, testing beneath 0.7100 after Thursday's bullish attempt to 0.7150 reversed as the US Dollar saw broad-market pickup once again, sending Dollar-crosses down across the board.

Friday is likely to see the AUD take another leg lower, with high-impact economic data from China due early in the day at 02:00 GMT. China's GDP figures are expected to show a decline in Chinese domestic growth, with 2018's 3rd quarter q/q growth expected to clip down to 1.6% (last 1.8%), and the y/y figure is expected to dip from 6.7% to 6.6%.

Trade war concerns and fallout from trade tariffs from the US are beginning to take their toll on the Chinese economy, and Asia-session traders are getting nervous that the slowdown will have a measurable effect on China's major trading partners, including Australia.

AUD/USD levels to watch

The Aussie is planting itself firmly into the bearish side for Friday, as noted by FXStreet's own Valeria Bednarik: "technically, the short-term picture supports such decline, as in the 4 hours chart, the pair trades back below the 20 and 100 SMA, while technical indicators re-entered negative territory and stand at fresh daily lows. Furthermore, the pair has broken below the 38.2% retracement of the latest daily slump after flirting with the 61.8% retracement of the same decline late Wednesday. The next Fibonacci support comes at 0.7085, the only obstacle ahead of the yearly low."

Support levels: 0.7085 0.7040 0.7000

Resistance levels: 0.7120 0.7160 0.7200

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