The aussie took a nosedive overnight after concerns grew over the likelihood of a resolution in the US-China trade dispute. Some US officials have stated roadblocks ahead and Chinese resistance towards US demands. Markets’ hopes for a quick settlement have faded and we could see the negotiations drag on or even fail at some point. The Australian dollar has recouped some losses though sentiment remains pessimistic.
On the technical side, AUDUSD met stiff selling pressures near both 20 and 30-day moving averages. 0.7050 is the immediate target on the downside. The upside risk would be a break above 0.7100.
The sentiment-price correlation chart shows the sentiment retreating from the recent top. Daily news sentiment is moving higher and in 50% of the last 10 occurrences price has risen within 9 days.