AUD/USD clings to sub-0.6900 area as trade negative news, lack of fresh catalysts in play

  • Pessimism surrounding the US-China trade environment keeps Aussie under pressure.
  • A lack of data at home ahead of PMI also plays their role to compress the moves.

Amid trade negative news and lack of fresh catalysts, the AUD/USD pair seesaws near 0.6880 during the early Asian session on Thursday.

The US and China remain at loggerheads as the US is expected to add hardships for China by weighing a proposal to ban five Chinese video surveillance companies and also negating to visit Beijing for fresh trade talks.

In response, Chinese media were active criticizing Trump administration’s latest behavior and signaled challenges for the US firms in their geographic limits.

Gains of the US Dollar (USD) on the back of no major negatives from the FOMC minutes could also be considered as a reason for the Aussie’s decline.

Risk sentiment was also negative as the US 10-year treasury yield dropped nearly four basis points from 2.38% by the press time.

There was no major economics from home while traders await flash purchasing manager index (PMI) numbers. The flash manufacturing PMI marked 50.9 (revised from 51.0) whereas its services counterpart registered 50.1 (changed from 50.5) during April.

Technical Analysis

The latest lows near 0.6860 act as immediate support for the pair, a break of which highlights January 2016 low surrounding 0.6830, followed by 0.6800 round-figure during further south-run.

Alternatively, a descending trend-line since April 18 at 0.6930 may limit the pair’s immediate upside ahead of fueling it to 0.7000 resistance level.

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