AUD : Trade Wars 2.0
(Fri, 15 May 2020). The Australian Dollar looks set to come into the cross-fires once again as US-China trade tensions pick up. The Trump administration has moved to block shipments of semiconductors to Huawei from global chipmakers, which in turn has seen China look to potentially respond via placing tech companies, such as, Apple and Qualcomm on an unreliable entity list. That said, risks look to be increasing to the downside for high beta currencies, particularly the Australian Dollar. Alongside this, we will be placing a close eye on the offshore Yuan (USDCNH).
AUSTRALIAN DOLLAR TECH LEVELS
As downside risks grow for AUD/USD, near term focus is on 0.6400-07, which marks the 76.4% fib retracement. A closing break below opens up room for a test of the May double bottom. On the topside, given the macro backdrop bounces in the Aussie may be short-lived and thus upside to be capped from 0.6450-0.6500.
GFS ASIA TEAM
- just now