- The Aussie is seeing renewed selling as the US steps up trade barriers with China.
- Macro data due early for Wednesday could extend the slide if readings are poor.
The AUD/USD is sharply lower heading into Wednesday’s Asia trading session, knocking back into 0.7425 on the back of headlines that the US is again ramping up a trade war with China.
The US is planning to announce another raft of tariffs on Chinese goods, valued at roughly $200 billion USD, and broader markets are back on the defensive as trade fears once again take the wind out of risk appetite’s sails.
Fresh trade war angst will do little to help the Aussie, which sees the Westpac Consumer Confidence indicator early at 00:30 GMT (last 0.3%), followed by Home Loans figures for May (forecast -1.9%, last -1.4%), and a surge of safe-haven-seeking across the G10 currencies will see traders leaning into the bearish side, and a missed reading for macro indicators could see the AUD/USD wipe out recent gains.
AUD/USD levels to watch
The Aussie already faced downside pressure through Tuesday’s trading, dipping to a low of 0.7430 before recovering back to the 0.7470 region, but trade headlines is seeing continued weakness for the pairing, and a continued slide will see support at the last swing low of 0.7360, with last week’s lows near 0.7310, 2018’s current low. Daily candles are showing a turnaround at the recent peak of 0.7480, just shy of the key 0.7500 major handle, and a bearish continuation will mark in another lower high for the bearish-trending pair.
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