FXStreet (Guatemala) – AUD/USD has been in supply on the back of the Chinese crisis and the February meeting might be a close call with the RBA potentially wanting to preempt the inevitable headwinds. The price has taken out the Dec lows and moved in on the 0.7000 level overnight. This has opened up the possibility for a breakdown to the post Black Monday crisis downtrend and lows made in early September at 0.6907.
The catalyst yesterday was the Chinese stock market , devaluation of the Yuan yet again and poor building approvals data in the Australian economy. Today, the fix will be monitored yet again, as will stock market and so to will we be keeping an ear to the ground in respect of the Chinese authorities subsequent course of action to try and get a grip on and get stability back in the markets. Before all that, the Aussie retail sales will also be an event to watch while the Australian economy’s performance will now be strongly scrutinised ahead of the RBA meetings throughout Q1/H1.
Also, nonfarm payrolls will up in the US tonight and could be the straw that breaks the bull’s back if the report is strong, overriding the dovishness in the FOMC minutes – on the other hand, it could be the Aussie saving grace on a headline number much less than 200k.
AUD/USD levels
Technically, in a bearish trend with little in the way of technical support below 0.6980/00, the late September lows remain compelling at 0.6940 before 0.6907 the low. 0.7080 is first key resistance while bulls may struggle at 0.7090 and the 20 SMA on the hourly. 0.7120 thereafter and 0.7156.
(Market News Provided by FXstreet)