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Australian dollar drops sharply to 0.7070

OctaFx | Mar. 20, 2019
Australian dollar drops sharply to 0.7070

The Australian dollar dropped sharply after trade jitters re-appeared. The Australian dollar is exposed to China’s performance as it accounts for two-thirds of all its trade.

March 20, OctaFX – US stocks pared the earlier gains yesterday after trader worries reappeared. This is after a report noted that there were unfinished issues in the trade talks. A source said that China is not likely to comply with a number of the points discussed in the talks.

As a result, US officials, including Robert Lighthizer and Steve Mnucchin, will travel to China in a bid to hammer a final deal. These officials have been in contact with China’s Liu He through video communications but the remaining details require face-to-face negotiations. After gaining by triple digits, the Dow ended the day 27 points lower. The Australian and New Zealand dollar declined as well.

AUDUSD technical analysis

The Australian dollar dropped sharply after trade jitters re-appeared. The Australian dollar is exposed to China’s performance as it accounts for two-thirds of all its trade. The pair reached a low of 0.7056. In the Asian session, it pared some of those losses and is currently trading at 0.7070.

On the hourly chart, this price is slightly below the 38.2% Fibonacci Retracement level and slightly above the lower line of the Bollinger Bands. The RSI has emerged from the oversold level and is currently at 36. The pair will likely recover as China and the US defend the deal they are negotiating.

Australian dollar drops sharply to 0.7070

Disclaimer

This article was provided by OctaFX. It should NOT substitute for professional marketing consulting. Forex margin trading involves substantial risks. Forex margin trading exposes participants to risks including, but not limited to, changes in political conditions, economic factors, and other factors. All of which may substantially affect the price or availability of one or more foreign currencies.

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