- The AUD/USD fails to hold initial strength ahead of key data from home, China and the US.
- 50-day SMA acts as an immediate upside barrier with 0.7050 being nearby support.
AUD/USD is near to 0.7100 mark during early Asian session on Monday. The pair began the week’s trading at the highest level since March 27 as traders took advantage of the weekend releases from China coupled with positive developments surrounding the US-China trade deal. However, buyers remained worried ahead of key domestic and China data that led them to book profits.
Not only upbeat comments from the US lawmakers concerning the progress at the US-China trade negotiation front at the end of two-day trade discussion visit to Beijing, but upbeat purchasing managers’ index (PMI) figures from China also pleased Aussie traders off-late. The NBS manufacturing PMI crossed 50.00 differentiating points for the first time in four months whereas non-manufacturing PMI also rose to six month high.
Looking forward, February month HIA new home sales followed by the National Australia Bank’s business confidence and business conditions survey results for March will be the key at the domestic level. Elsewhere, China’s Caixin Manufacturing PMI for March, the US retail sales and ISM manufacturing PMI will be crucial as well.
The HIA new home sales grew -1.8% during the previous month whereas business conditions and confidence gauges were at 4 and 2 levels respectively during their latest release. China’s Caixin manufacturing PMI may remain unchanged at 49.9 while the US retail sales group may register softer growth figure of 0.4% against 1.1% but ISM manufacturing PMI from the US could rise to 54.5 from 54.2.
The recent increase in the China data and positivity surrounding the US-China trade deal has helped built the start of the week optimism for the AUD/USD pair. Chances of the quote’s further upside depend on a slew of upcoming data stream together with how the world’s two largest economies come progress over a trade deal when Chinese delegates arrive Washington on Wednesday.
AUD/USD Technical Analysis
In spite of its upbeat opening, the AUD/USD pair couldn’t clear 50-day simple moving average (SMA) figure of 0.7120 that holds the gate for further upside to 0.7155-60 resistance-confluence comprising 100-day SMA and six-week-old descending trend-line.
On the downside, 0.7050, 0.7020 and 0.6980 are likely important supports that sellers should observe in order to benefit during the pair’s declines.
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