The AUD/USD has had a relatively soft all week and while there hasn’t been much by way of local data to move markets, yesterday’s weak China number put pressure on many risk assets.
Yesterday Chinese Industrial Production came in at 5.3% vs 5.5% exp. This was down from 5.7% previously and is on a steep decline. This was a decade lower number if I am not mistaken.
The result didn’t smash the AUD/USD, however, it did drift over the course of the session.
The main pressure from an Aussie perspective remains the fact that the RBA is now under pressure to cut rates. While many believe the RBA is in a state of denial, the major banks and economists are all coming out and looking at possible rate cuts in 2019.
This will clearly put more pressure on the AUD/USD going forward and with little strong
The AUD/USD] is now facing some stiff resistance at the 0.7100 level where we have now failed multiple times. Below that point, 0.7050 is clear support.
The round number levels are providing plenty of support and resistance with 0.7000 and 0.7200, S2 and R2 respectively
Key support at 0.7000 is the big psychological level that the AUD/USD will need to crack, but that might take some hint of a cut from the RBA, which doesn’t appear to be all that forthcoming at the moment. If the weak data continues to come both locally and from China then that might even take the decision out of the RBA’s hands as they will be forced into a cut.