AUD/USD: on thin ice ahead of Chinese trade data

Currently, AUD/USD is trading at 0.7908, down -0.08% on the day, having posted a daily high at 0.7916 and low at 0.7905.

AUD/USD is consolidated holding above the 0.79 handle, but only just. Today, the Chinese will report their trade balance and Australia reports NAB business confidence and business conditions. Either one of these could impact the Aussie, especially on Chinese trade. However, whether there is a disappointment or not, the dollar may be hard pressed to run too far in the current environment. 

"FOMC dove (and non-voter) Bullard said he is worried about the softness in inflation and didn’t expect falling unemployment to provide a boost to such. He supported a start to tapering soon. Dove (and voter) Kashkari thought the economy was doing well but wage growth was slow," noted analysts at Westpac.

AUD/USD 1-3 month: 

However, on a wider stand point, the analysts at Westpac argued that if the RBA remains firmly on hold, as they expect, and the US dollar rises on tighter Fed policy, then AUD/USD could fall as far as 0.74 by year end.

AUD/USD levels

AUDUSD: Selling rallies    

On poor data today, Valeria Bednarik, chief analyst at FXSreet argued that AUD/USD could finally break below the key 0.7870 support. "Technical readings in the 4 hours chart support a bearish continuation, as the 20 SMA heads north, capping the upside and acting as dynamic resistance now at 0.7935 while the Momentum indicator maintains a bearish slope within negative territory and after failing to surpass its mid-line," Bednarik explained.