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  • AUD/USD pair drops from the highs of last week as the new week begins.
  • China’s data dump is eyed for further directional bias.
  • Covid fear in Australia continues to press the pair.
  • FOMC minutes can highly impact the pair.

The AUD/USD price analysis shows some mild selling as the new week begins. The AUD/USD finds offers near 0.7360 area. The pair is down 0.13% at the time of writing.

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The Aussie pares off the gains acquired on Friday, falling from the highs of 0.7390s. However, the Australian Dollar sellers keep the hopes alive to extend losses below the mid-0.7300 area.

For July, China’s house prices figures came at 4.6% y/y while the same was 4.7% for June. The market awaits further data from China, including unemployment and industrial production figures.

Coronavirus fears in Australia

Although the US data last week raised some concerns about the country’s economic health that triggered a much-awaited retracement in the Greenback, the Australian economy isn’t performing quite well.

The Delta variant spread across the country keeps pressure on the economy. The virus number is at yearly highs and alarming for coming up dark days.

The Reserve Bank of Australia has already lowered its hawkish tone and accepted the economic challenges that arise from virus resurgence.

Fed tapering talks

The FOMC meeting minutes are due this week. Market participants are eager to find the reaction of US Treasury yields on the release of meeting minutes and retail sales data. The Fed’s meeting on July 27-28 that pulled “substantial further progress” language in the press statement seems to provide some meaningful traction on the debate of Fed’s tapering and whether the policymakers are interested in slowdown the asset purchase program before the year ends or not. Retail sales data can also highlight the deteriorated consumer sentiment and their spending habits

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AUD/USD technical analysis: Ascending trendline resisting gains

AUD/USD 4-hour chart analysis
AUD/USD 4-hour chart analysis

The AUD/USD found active selling near the ascending trendline/broken trend channel that continues to cap the gains. The price is now near the congestion of 50-period and 20-period SMAs on the 4-hour chart. However, the downside price wave is not supported by the rising volume. It indicates that the selling pressure is due to profit-taking and not due to fresh selling in the market. However, overcoming the 0.7400 mark and the ascending trendline is still important to post further gains.

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