AUD/USD sticking to 0.72 heading into Australian trade data

Wednesday's GDP bump for the AUD fizzled quickly at the hands of China trade angst.
Thursday's Trade Balance marks the fourth straight day of meaningful data for the Aussie, yet little bullish momentum has been had.

Joshua Gibson FXStreet

The AUD/USD continues to trade just beneath the 0.7200 handle heading through Thursday's early overnight session after ending Wednesday flat.

The Aussie caught an early ride yesterday thanks to a bumper reading of the Australian GDP indicator, but a sinking PMI from China threw cold water on the bullish party, and Antipodean traders head into Thursday bracing for Australia's Trade Balance data, due early at 01:30 GMT.

Australia's Trade Balance for July is expected to contract to $1.4 billion after the previous month's showing of $1.873 billion. Australia's largest trading partner, China, has been facing down sluggish growth at the hands of the ongoing US-China trade war, which threatens to sink Australia's growth prospects in a knock-on environment where metals prices, another key element for Australia, also faces price pressures at the hands of external trade factors.

Traders will also be keeping an eye turned towards Friday's Non-Farm Payrolls, as the global markets head towards another NFP Friday.

AUD/USD levels to watch

Bearish pressure continues to pile onto the AUD/USD pairing as confidence remains subdued in the Pacific regions, and as FXStreet's own Valeria Bednarik noted: "despite advancing, the AUD/USD pair has posted a lower low and a lower high daily basis, indicating that bears are still in control of the pair. In the shorter term, and according to the 4 hours chart, the upside seems limited, as the pair is unable to break above a bearish 20 SMA, currently hovering around it, while the Momentum indicator retreats modestly from its 100 level and the RSI hovers around 44. The Aussie is still vulnerable, and a break below 0.7150, could put the pair back under selling pressure."

Support levels: 0.7150 0.7120 0.7095

Resistance levels: 0.7235 0.7270 0.7300

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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