AUD/USD sold-off again at 0.6915 despite trade optimism, RBA SoMP eyed

• AUD/USD fails to hold above 0.6900 once again on broad dollar strength.
• The spot still clings to Thursday’s gains amid US-China trade deal hopes.
• All eyes on RBA’s SoMP for the next leg higher in the Aussie ahead of US data.

The AUD/USD pair is seen consolidating the recent upsurge near the 0.69 handle in early dealings, with markets awaiting the Reserve Bank of Australia’s (RBA) Statement on Monetary Policy (SoMP) for the next push higher.

RBA’s SoMP to bolster the doves?

With mixed trade lines having crossed the wires in the final hours of the American trading, the Aussie bulls turn cautious, failing to surpass the key 0.6915 resistance on multiple occasions.

Although the US officials confirmed the plan that the US will rollback the tariffs on China in the lead up to the Phase One deal signing, some White House sources reported that the rollback plan faces fierce internal opposition. These continue to keep any clarity elusive and hence, keep the gains in the higher-yielding AUD capped.

Further, the upside in the AUD/USD pair also remains limited by the ongoing broad-based US dollar buying, mainly fueled by the rally in the US Treasury yields across on the curve on rising trade deal hopes, as the positive correlation between the greenback and the US rates return.  

Amid trade-related developments, the spot now awaits the RBA’s SoMP, with any dovish hints likely to drag the Aussie further away from the 0.69 handle. However, the reaction could be limited, as US-China trade news will continue to remain the main market motor ahead of the US macro releases.

AUD/USD Technical levels to consider