China's pledge to to stimulate economy fails to breathe life into risk assets
In fact, AUD/USD slumps to a seven-week low on the day
Upon conclusion of its economic planning for 2019, China said that it would significantly cut taxes and signal possibly more accommodative monetary policy - they removed the wording 'neutral' and said that they would strike a balance between easing and tightening policies - in order to stimulate economic growth.
However, the pledge is failing to give risk assets a boost on the day with risk currencies trading near the lows at the moment and equities also still looking more pessimistic than they were at the start of the trading day.
E-minis are currently down by 0.5% at the moment:
For AUD/USD, price is now looking to hold a break below the September low @ 0.7085. If sellers manage to do so, the next support levels will come from the year's lows @ 0.7021-40 and then the 0.7000 handle.
As noted earlier, as we approach the 0.7000 handle, that is where sellers are looking to take some money off so be wary of that. It's going to take a real spark for price to break below that level and so far, I'm not seeing that come about just yet.
But if US equities continue to free fall later, that may very well be the right catalyst as we close out the year.