AUD/USD Price Analysis: Drops further below 0.7200 on downbeat China trade balance

  • AUD/USD extends pullback from a six-week-old resistance line, declines further below 200-bar SMA after China trade numbers.
  • China’s September month Trade Balance eased to $37B (USD), 257.68B (CNY).
  • The confluence of 100-bar SMA and a two-week-old support line can probe the bears.

AUD/USD drops to lowest since last Thursday while flashing 0.7164 figures during the early Tuesday. In doing so, the pair reacts to China’s September month trade numbers.

Although Beijing trade balance with the US rose over 2.0% during the January-September period, the monthly figures were disappointing, which in turn challenged the AUD buyers. Details suggest the headlines Trade Balance dropped to 257.8B Chinese yuan (CNY) versus 416.6B prior. Further, the USD terms numbers were equally disappointing with $37B actual compared to $59.9B forecast and $58.9B previous readouts.

The bears are currently targeting 0.7150/45 support confluence that comprising 100-bar SMA and an upward sloping trend line from September 25. Though, weak RSI conditions might challenge the AUD/USD bears afterward.

Should the sellers refrain from respecting the 0.7145 support level, the monthly low of 0.7095 and the previous month’s bottom of 0.7004 will be their favorites.

On the contrary, 200-bar SMA and a falling trend line from September 01, respectively near 0.7225 and 0.7240, will challenge the AUD/USD bulls before directing them to the mid-September peak surrounding 0.7350.

AUD/USD four-hour chart

Trend: Bearish

 

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