- Bulls barely managing to keep the Aussie-Dollar pair strung up at the 0.7200 handle.
- Trade war fears to continue driving AUD/USD action for the time being.
AUD/USD looks set to maintain a bearish stance heading into the new trading week, ticking down into a fresh three-week low at 0.7178 before rebounding into the 0.7200 handle, a level that has kept the Aussie pairing under wraps for most of November's trading.
The Aussie has closed in the red against the greenback for five straight trading days, wiping out last week's early gains on rebounding risk appetite, but renewed trade concerns stemming from the US-China trade spat stopped the AUD's bullish attempts in its tracks, and the Aussie sees itself deflating at the 0.7200 major level as investors await further impetus amidst tense broader markets. Chinese trade data over the weekend also disappointed, with China's imports declining by a massive 25%, and fallout from the Sino-US trade war will see Aussie bulls balking as risk appetite hangs on the health of the Chinese economy and its ability to increase demand for Aussie goods over time.
On the other hand, October's Home Loans data helped to spark an early-session bump in the AUD/USD pairing, with home loans rising by 2.2%, leaping over the -1.0% contraction in the previous month, and with the Australian housing market continuing to show signs of alarm mixed in with sluggish recovery, any good sign will be taken as a bonus for Aussie investors. This week's economic calendar for the AUD remains fairly limited, though Thursday will be seeing the Reserve Bank of Australia's latest bulletin, where investors will be hoping for a more hawkish outing from the RBA on improving housing numbers.
AUD/USD levels to watch
Overall the Aussie remains in a bearish stance, and despite flashes of bullish momentum here and there, the pair looks set for furthe downside according to FXStreet's own Valeria Bednarik: "the pair is technically bearish according to the daily chart, as the pair broke below the 20 and 100 SMA by the end of the week, with the largest one providing an intraday resistance at 0.7240, while technical indicators settled near their weekly lows, the RSI maintaining a strong bearish momentum, in line with further declines ahead. In the 4 hours chart, the bearish case is even stronger, as the pair finished below all of its moving averages and with the 20 SMA heading sharply, having already crossed below the 100 SMA, while technical indicators resumed their declines within negative levels after correcting extreme oversold conditions."
Support levels: 0.7175 0.7140 0.7100
Resistance levels: 0.7210 0.7250 0.7300
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