“¢ USD fades new US tariff-led early bounce and helps regain traction.
“¢ RBA minutes/most in-line Aussie HPI remains supportive of the up-move.
The AUD/USD pair quickly reversed an Asian session dip and was now seen building on the positive momentum further beyond the 0.7200 handle.
The latest development in the US-China trade spat exerted some fresh downward pressure on the China-proxy Australian Dollar, especially after the US President Donald Trump imposed tariffs on another $200 billion worth of Chinese imports.
Trump also warned to pursue tariffs on $267 billion of additional imports if China takes retaliatory action but the US Dollar faded the post-announcement bounce. Moreover, a 10% tariff was less than previously feared and helped the pair to rebound over 70-pips from an intraday low level of 0.7144.
Bullish traders further took cues from today’s release of mostly in-line housing inflation data and the latest RBA monetary policy meeting minutes, which sounded optimism on the healthy labor market, falling currency and resilient household consumption.
In absence of any major market moving economic releases, the USD price dynamics and any fresh trade-related developments might continue to act as key determinants of the pair’s momentum through Tuesday’s trading session.
Technical levels to watch
Immediate resistance is pegged near the 0.7230-35 region, above which the pair seems all set to extend the momentum towards 0.7270-75 intermediate hurdle en-route the 0.7300 round figure mark.
On the flip side, any meaningful retracement now seems to find immediate support near the 0.7175 area and is followed by the 0.7145-40 region, which if broken might turn the pair vulnerable to slide back towards the 0.7100 handle.
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