AUD/USD keeps losses as China's PPI growth slows to 3.3%

The Aussie dollar is on the defensive, having charted a bearish RSI divergence earlier today.
China producer price inflation (PPI) or factory-gate price growth slowed more than expected in October.

Omkar Godbole FXStreet Contributor

The AUD/USD is currently trading at 0.7250, representing a 0.10 percent drop on the day, and may drop further on bearish technical setup and dismal China inflation data.

The currency pair charted a bearish divergence of the 4-hour chart relative strength index (RSI) earlier today as it dropped close to 50 pips from the high of 0.73. As a result, the pair could remain on the defensive in the next few hours.

More importantly, the bearish technical setup has likely been bolstered by a weaker-than-expected China PPI release. The October factory-gate inflation gauge came-in at 3.3 percent, missing the estimated print of 3.4 percent and down from the previous month's reading of 3.6 percent.

It is worth noting that a pick-up in China PPI back in mid-2016 had triggered the great reflation trade, helping the commodity dollars like the AUD stage a solid rally against the greenback.

AUD/USD Technical Levels

AUD/USD

Overview:
    Last Price: 0.7249
    Daily change: -5.0 pips
    Daily change: -0.0689%
    Daily Open: 0.7254
Trends:
    Daily SMA20: 0.7136
    Daily SMA50: 0.716
    Daily SMA100: 0.7266
    Daily SMA200: 0.7474
Levels:
    Daily High: 0.7304
    Daily Low: 0.7246
    Weekly High: 0.726
    Weekly Low: 0.705
    Monthly High: 0.724
    Monthly Low: 0.702
    Daily Fibonacci 38.2%: 0.7268
    Daily Fibonacci 61.8%: 0.7282
    Daily Pivot Point S1: 0.7233
    Daily Pivot Point S2: 0.7211
    Daily Pivot Point S3: 0.7175
    Daily Pivot Point R1: 0.729
    Daily Pivot Point R2: 0.7326
    Daily Pivot Point R3: 0.7348

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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