AUD/USD rallies hard towards 0.7750 as China Xi boosts risk sentiment
- China Xi’s soft stance on trade issue lifts appetite for risk assets.
- Shrugs-off Aus NAB confidence survey misses and stronger DXY.
The AUD/USD pair caught a fresh bid-wave and bounced almost 40-pips rapidly, tracking the renewed risk-on rally in the US equity futures and Asian stocks, triggered by the Chinese President Xi’s soft stance on the US-China trade angst.
China’s President Xi made a strong case to hold a dialogue to resolve the trade disputes while adding that China should push for free trade and uphold the multilateral trading system.
However, it remains to be seen if the spot can sustain the renewed uptick, as disappointing Australia’s NAB business condition/ confidence surveys continue to weigh negatively on the AUD.
Moreover, the Aussie could also feel the heat from the broad-based US dollar rebound, with the DXY advancing +0.08% to 89.60, bouncing-off six-day lows of 89.48 levels.
Looking ahead, the pair will continue to track the broader markets sentiment, as markets digest the comments from China’s Xi. Also, the US PPI data and the sentiment on the Wall Street will have a major influence on the Aussie later on Tuesday.
AUD/USD levels to watch
According to Valeria Bednarik, Chief Analysts at FXStreet, "the recovery has left the pair inside the usual range, and the 4 hours chart is once again offering a neutral technical stance, as indicators continue hovering around their midlines, while the price moves back and forth around a flat 20 SMA. The key resistance is the 0.7740 region, the 61.8% retracement of the December/January rally, as only above it the upside will gain some adepts. Support levels: 0.7640 0.7590 0.7550.”