Another new 2018 low reached today
The AUDUSD made a new 2018 low today at 0.70847. The low was also the lowest level since February 14th, 2016 week. The pair remains below the the 0.7144-59 area. That area was swing lows from May and December 2016, and is also home to a lower trend line (at 0.7145). The current price is at 0.7100. Stay below the area keeps bears more in control.
Drilling to the hourly chart, the step down lows are not running but slowly going lower. A topside trend line comes in at 0.7111 currently. A move above would take some of the bear out of the market. Above that, and the 100 hour MA at 0.71445 (and moving lower) would be a target. The 200 hour MA comes in at 0.71768, and would be another target. Moves above those levels, takes more and more of the bearishness out of the pair.
Fundamentally, the market is awaiting the next shoe to drop (or not drop) on China tariffs.
The next $200B has not been enacted yet by the US. Some think, Trump may delay implementation until after the election. The current $50 billion is a lot less than $250B in total. An enactment of the full $250B would have an impact on prices, jobs and growth in both countries - and in turn other countries like Australia. That could be a negative for the November US elections.
China's reaction will also be evaluated.
Any enactment of the $200B, should/would have a negative impact on the AUDUSD.
Conversely, any hope of avoiding tariffs should be positive for the AUDUSD.
So there is a lot of event and headline risk. Plan your trade - and stops - accordingly.
