AUD/USD retreats to 0.6600 amid renewed US-Sino woes, focus shifts to RBA


  • AUD/USD is seeing fresh selling pressure at the start of a new week.
  • China, US fundamentally disagree over Taiwan, global rules.
  • US Dollar holds the post-NFP rally, focus shifts to the RBA decision.

AUD/USD is seeing a negative start to the Reserve Bank of Australia (RBA) decision week, as investors digest the latest concerning developments between the US and China over Taiwan and over a range of other issues, including Taiwan, semiconductor chip exports etc.

Speaking at Asia’s top security summit, the Shangri-La Dialogue on Sunday, Chinese Defence Minister Li Shangfu warned, “it is undeniable that a severe conflict or confrontation between China and the US will be an unbearable disaster for the world.”

US Secretary of Defense Lloyd Austin told the meeting that Washington was “deeply committed” to preserving the status quo in self-ruled Taiwan that Beijing claims as its own territory.

Meanwhile, a Chinese warship came within 150 yards (137 meters) of a US destroyer in the Taiwan Strait in "an unsafe manner," US military officials said, In response, China blamed the US for "deliberately provoking risk" in the region.

Besides the renewed tensions between the US and China, AUD/USD also remains weighed down by a broadly stronger US Dollar, especially in the wake of a stunning US Nonfarm Payrolls print.

The US economy added 339K jobs in May vs. 190K expected and the upwardly revised previous reading of 294K. The wage inflation component in the jobs report softened to 4.3% while the Unemployment Rate in the US ticked higher to 3.7% in the reported period, compared with expectations of 3.5%. However, following the mixed US employment data, markets continued to price a 75% probability that the US Federal Reserve (Fed) will pause at the June 13-14 policy meeting.

Attention now turns toward the Chinese Caixin Services PMI, US ISM Services PMI due later in the day ahead. Although investors eagerly await the RBA policy announcements on Tuesday for a fresh direction in the pair. The RBA is expected to hold rates at 3.85% in June but economists and money markets remain divided over its next move as lingering price pressures and recovering home prices suggest a hike may be needed while weaker activity and rising unemployment argue for a pause.

AUD/USD: Technical levels to consider

AUD/USD

Overview
Today last price 0.6604
Today Daily Change -0.0005
Today Daily Change % -0.08
Today daily open 0.661
 
Trends
Daily SMA20 0.6626
Daily SMA50 0.6664
Daily SMA100 0.6755
Daily SMA200 0.6695
 
Levels
Previous Daily High 0.6639
Previous Daily Low 0.6565
Previous Weekly High 0.6639
Previous Weekly Low 0.6458
Previous Monthly High 0.6818
Previous Monthly Low 0.6458
Daily Fibonacci 38.2% 0.6611
Daily Fibonacci 61.8% 0.6593
Daily Pivot Point S1 0.6571
Daily Pivot Point S2 0.6531
Daily Pivot Point S3 0.6497
Daily Pivot Point R1 0.6644
Daily Pivot Point R2 0.6678
Daily Pivot Point R3 0.6718

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

AUD/USD stays defensive below 0.6650 amid China slowdown worries

AUD/USD stays defensive below 0.6650 amid China slowdown worries

AUD/USD stays weak below 0.6650 in Asian trading on Tuesday, undermined by mounting worries over China's economic slowdown. The Aussie shrugs off small rate cuts by the PBOC and a subdued US Dollar. Pre-US earnings results caution also weighs on the pair. 

AUD/USD News

USD/JPY extends losses toward 156.00, as risk-off mood returns

USD/JPY extends losses toward 156.00, as risk-off mood returns

USD/JPY accelerates declines toward 156.00 early Tuesday. The Japanese Yen stays bid as risk-off flows return in the Asian session, sustaining the US Dollar weakness-driven downside in the pair. The pair looks to Japanese verbal intervention and mid-tier US data. 

USD/JPY News

Gold price moves away from over one-week low, climbs back above $2,400 mark

Gold price moves away from over one-week low, climbs back above $2,400 mark

Gold price extended its recent corrective slide from the record high touched last week and fell to a more than one-week trough on Monday. US President Joe Biden's withdrawal from the 2024 Presidential election increased the chances of Donald Trump becoming the next US President, raising hopes of a looser regulatory environment.

Gold News

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Bitcoin finds support around the $67,000 level

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Bitcoin finds support around the $67,000 level

Bitcoin and Ripple prices are holding steady around their respective weekly and daily support levels, hinting at an imminent rally. Meanwhile, Ethereum is encountering resistance at the $3,530 mark; a decisive close above this level would signal a bullish breakthrough.

Read more

Earnings review

Earnings review

In recent years, the focus has been on the Magnificent 7, particularly Nvidia’s monster earnings reports, which have dominated the market. While Nvidia’s results are still extremely important for overall sentiment, there is a hope that sales growth and revenues can pick up across a broad range of global markets and sectors.

Read more

Forex MAJORS

Cryptocurrencies

Signatures