- Risk-aversion creeps into Europe, drags higher-yielding Aussie lower.
- Chinese Foreign Ministry dissatisfied with US sanctions on Huawei.
- US-China trade risks, Fed speak in focus amid lack of first-tier macro data.
The Asian bounce in the AUD/USD pair lost leg just shy of the 0.68 handle in early European trades, with the spot now extending the retreat towards 0.6770 region, as risk-off grips the European markets amid lingering US-China trade fears.
RBA discussed unconventional policy at August meeting
The Antipodeans ignored the Reserve Bank of Australia’s (RBA) August meeting’s minutes, which revealed the RBA board having discussed unconventional monetary policy, including negative interest rates, and extended the bounce from 0.6755 lows.
The Aussie’s uptick to near 0.6800 levels could be attributed to a risk-on market profile combined with the signs of firming Chinese commodities’ imports, as suggested by the mining giant, BHP Group. AUD Bullish: US-China trade spat not yet hurting demand for its commodities - BHP
However, sellers returned and guarded the 0.68 handle once again, as fears resurfaced around the US-China trade spat and soured the risk sentiment, in turn weighing negatively on the risk/ higher-yielding currency, the AUD.
The Chinese Foreign Ministry said that it was dissatisfied with the US sanctions on Huawei while Huawei’s founder Ren said that Huawei expects no relief from the US. This shows that the tensions persist between the US and China before the two teams meet in person to figure out a solution next month.
Looking ahead, with a lack of fresh first-tier economic data from the US docket, the trade-related headlines and sentiment on the Wall Street will continue to direct the moves in AUD/USD, as markets digest downbeat Australian ANZ/Roy Morgan Consumer Sentiment survey released earlier today.
AUD/USD Technical levels to watch
|Today last price||0.6772|
|Today Daily Change||0.0011|
|Today Daily Change %||0.16|
|Today daily open||0.6764|
|Previous Daily High||0.6789|
|Previous Daily Low||0.6761|
|Previous Weekly High||0.6818|
|Previous Weekly Low||0.6736|
|Previous Monthly High||0.7082|
|Previous Monthly Low||0.6832|
|Daily Fibonacci 38.2%||0.6772|
|Daily Fibonacci 61.8%||0.6778|
|Daily Pivot Point S1||0.6753|
|Daily Pivot Point S2||0.6743|
|Daily Pivot Point S3||0.6725|
|Daily Pivot Point R1||0.6781|
|Daily Pivot Point R2||0.6799|
|Daily Pivot Point R3||0.681|
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