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by FXOpen on December 10th, 2018

AUD/USD continues to decline following the news about US-China trade relations

The Australian Dollar declined heavily last week by a combination of negative news about US-China trade relations, low demand for risky assets and Australian economic data (weaker than expected).

The Reserve Bank of Australia continues to hold the official cash rate at 1.5 percent for a 28th consecutive month ahead. The RBA maintained a positive position in the labor market, citing a speed-up in wages growth last month. However, there were some signs of deceleration and declines in commodity prices.

Australian Retail Sales came in at 0.3% as expected. The Aussie dropped after GDP turned out to be way below expectations. This reduced the odds of a rate hike by the RBA. Quarterly GDP came in at 0.3%, vs 0.9% expected.

AUDUSD-Chart (5)

The Aussie dollar declined recently and broke the 0.7320 and 0.7300 support levels against the US Dollar. The AUD/USD even traded below the 0.7240 support level to move into a short term bearish zone.

The pair traded close to the 0.7175 level and settled below the 50 hourly simple moving average. Later, the pair corrected higher above the 0.7200 level and the 23.6% Fib retracement level of the recent decline from the 0.7299 high to 0.7177 low.

However, the pair is currently facing a major resistance near 0.7220, 38.2% Fib retracement level of the recent decline, and a bearish trend line on the hourly chart. Therefore, the pair is likely to resume its decline below 0.7180 and 0.7170 in the near term.

On the other hand, a break above the 0.7220 and 0.7240 resistance levels is needed for a trend change.

By FXOpen

FXOpen is a Forex and Cryptocurrency broker founded in 2005 by a group of traders. With over 10 years of experience, the company has established itself as a major Forex broker that continues to expand rapidly across the globe. FXOpen offers the MT4 and MT5 Forex trading platform with a wide range of trading instruments including 100+ FX, CFDs, Indices and Cryptocurrency markets. FXOpen also provides its own PAMM technology allowing clients to benefit from the strategies of professional traders with a proven track record of successful trading. The FXOpen Group also includes the ASIC regulated FXOpen AU in Perth Australia and the London-based FXOpen UK that is regulated by the FCA.

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