- AUD/USD: lifted by trade wars on hold headlines, proxy to positive China news.
- AUD/USD: the technicals are mixed, longer-term bullish.
AUD/USD is currently trading at 0.7525 with a low of 0.7517 and a high if 0.7526. There was an opening bullish gap on the trade war relief where the US and China have put trade wars on hold.
China and U.S. agreed not to engage in a trade war – ANZ
US Treasury Secretary Mnuchin announced in a television that the Trump administration is putting US trade war with China “on hold” which gives the Aussie a boost considering its commodity status and close economic ties to China. Meanwhile, the AUD/USD had started out on the backfoot in European trade on the last day of trade last week, drifting back from 0.7528 to threaten 0.7498 early.
Eyes on Lowe this week
The Aussie extended its decline to 0.7488 in late London before traders in New York took on the baton and instead bid the pair up to 0.7518. A late drift lower made for a close of 0.7506 as EM’s came off during the day and AUD continues to trade as a proxy. We have a light calendar for the Aussie for the week ahead and eyes will be on RBA’s Lowe (May 23rd).
AUD/USD levels
Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart, the price is confined to a tight range alongside with its 20 and 100 SMA, while technical indicators turned south within neutral levels and argued that this was not enough to confirm an upcoming decline but leaning the scale toward the downside.
However, there is a positive RSI on the daily sticks and a long lower wick on the monthly charts. The 21-D SMA has been pierced and eyes are to the 0.76 handle. A move higher and if the price can get through the rising 200-D SMA on the 0.78 handle, 0.7910 will be in focus. To the downside, 0.7420 guards a break down to 0.7320 double bottom lows.
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