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  • AUD/USD benefited from China’s Caixin Manufacturing PMI as official PMI failed to grow.
  • US-China trade war acquires the center of market attention, Hong Kong protests also exert downside pressure.
  • Mixed Aussie data, ahead of the Chinese PMI, offered little moves.

Having witnessed upbeat manufacturing purchasing managers’ index (PMI) data from China, AUD/USD takes the bids to 0.6735 during early Monday.

With China’s August month Caixin Manufacturing PMI, 50.4 against 49.8 forecasts, defying the weekend release of official manufacturing, 49.5 versus 49.7 expected, Aussie buyers shrug off recent pessimism.

Earlier during the day, a slew of private data concerning the Australian economy was released. Among them, AiG Performance of Mfg Index for August and the second quarter (Q2) Company Gross Operating Profits flashed upbeat releases while Commonwealth Bank Manufacturing PMI and the Australia and New Zealand Banking Group’s (ANZ) Job Advertisements for August registered negative signals.

On the trade front, the US refrain from respecting China’s reversal of tariffs ahead of this month’s trade talk while protests in Hong Kong are likely to get a noticeable intervention from China, which in turn will become a negative to the discussion when the US and China meet for trade negotiation sometime during this month. Latest headlines suggest China will hold press conference on Tuesday to discuss view on Hong Kong’s current situation.

While most of the headlines scheduled for publishing are already out and loud investor might move on to focus more on the trade news amid a lack of data due to the US markets’ close. However, China’s press conference on Tuesday, together with Aussie retail sales and monetary policy meeting by the Reserve Bank of Australia (RBA), will offer active days ahead of the Wednesday’s second-quarter Gross Domestic Product (GDP) release.

Even if latest data from China, and also at home, fail to defy concerns of the RBA’s further easing, the central bank refrained from providing clear signal to the future easing and the same can gain support from GDP data.

Technical Analysis

The pair needs to slip beneath a rising trend-line since August 07, at 0.6700 now, in order recall early-August low of 0.6677, if not then chances of its another confrontation of 21-day simple moving average (SMA) figure of 0.6762 can’t be ruled out.