- The dollar is helped by the general mood of caution in the markets.
- Australian dollar does not get relief either due to expectations of a rise in the RBA, nor due to Chinese data.
- AUD/USD breaks key support at the 0.6850 area and then 0.6800.
The AUD/USD is tumbling down on Friday and is down over 130 pips. The pair reached 0.6762the minimum since May 2020. It remains in the low zone, in a context of general strength of the dollar.
The aussie had no respite on Friday even with the better-than-expected data from China’s Caixin Manufacturing PMI, which came in June at 51.7, improving from 48.1 and higher than the 50.2 expected. For the moment, the negative expectations about global growth cannot be overshadowed by the greater activity in China.
Nor the fact that a rise of 50 basis points is expected by the Reserve Bank of Australia next Tuesday helps the Australian dollar. The discussion led by Lowe will be whether to go up 25 or 50 points.
In minutes in the US, the manufacturing ISM for June will be released. Monday will be a holiday, on Wednesday the minutes of the Fed will come out and on Friday the official employment report.
AUD/USD is technically oversold in the very short term but there are no signs of a bounce or run out. The break of important technical levels such as the 0.6850 and 0.6800 area opened the door for more declines. The next strong support can be seen around 0.6700.
Technical levels
Source: Fx Street
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