FXStreet (Mumbai) – The AUD/USD pair dropped sharply in the European session, with the sell-off triggered by the Chinese stocks slump and steep losses in the Kiwi.
AUD/USD rejected at hourly 100-SMA, sell-off triggers
Currently, the AUD/USD pair trades -0.43% lower at 0.7228, bouncing-off lows struck at 0.7211 in early European trades. The Aussie extends its gradual descent after having peaked just shy of 0.74 barrier on Oct 12, and was heavily offered this session on back of a sudden sell-off in the Chinese stocks. The benchmark Shanghai Composite index closed -3.50% on the day.
The losses in the Aussie were also accentuated by the decline in commodity prices. Gold remains subdued near $ 1177; the US oil loses over 1% while copper prices drop -0.23%.
Markets also booked profits on their AUD longs after the prices failed to surpass 0.73 handle on Tuesday. Meanwhile, the Aussie will be influenced by the sentiment on the Wall Street ahead of tomorrow’s business confidence numbers reported by NAB.
AUD/USD Levels to watch
The pair has an immediate resistance at 0.7276/77 (Today’s High + hourly 100-SMA), above which gains could be extended to 0.7300 (Oct 20 High + round number) levels. On the flip side, support is seen at 0.7200 (20-DMA + psychological levels) from here it to 0.7162 (Oct 8 Low).
(Market News Provided by FXstreet)