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Australian dollar drops sharply after Trump hits China with new tariff threat

Australian dollar drops sharply after Trump hits China with new tariff threat

The AUDUSD pair extended its recent sharp pullback from near three-month tops and continued losing ground for the tenth consecutive session on Friday, falling back closer to early-Jan. flash crash lows.

2 August 2019, OctaFX – The Australian dollar dropped sharply after Donald Trump announced the new tariff threat. This is mainly because of the significant role the Chinese economy plays in Australia. Two-thirds of Australian goods like iron ore are exported to the country.

Earlier today, the country released the retail sales data. In June, retail sales increased by 0.4%, which was better than the expected 0.3%. In the second quarter, retail sales increased by 0.2%, which was slightly lower than the consensus estimate of 0.3%. In the quarter, the PPI increased by 2.0%, which was better than the expected 1.9%.

AUDUSD technical analysis

The AUDUSD pair declined sharply to a low of 0.6975. This was the lowest level in a number of months. On the hourly chart, the pair is trading below the 25-day and 50-day moving averages while the RSI has remained slightly above the oversold level.

The money flow index has also remained above the oversold level. Today, the pair will likely continue being more volatile as investors focus on the trade war concerns and US jobs numbers.

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.

 

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.

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