- Weaker than the China PMI forecasts are questioning the sentime of trade despite the US-Chinese trading law.
- Aussie housing, TD inflation and Chinese Caixin Manufacturing PMI can offer short-term trade directives.
After jumping for a fresh seven weeks, the AUD / USD pulls some of its winnings at 0.7030 during early Monday, as retailers recently uncover the weaker PMIs from China than the US-Chinese trade agreement headings.
The US and China trade bargain offered a sigh of relief to market players at the beginning of the trading week in Asia. However, optimism could not last long as traders also emphasized the Chinese index of manufacturing and non-productive procurement managers (PMIs).
The US and China agreed to halt further trade war and resume negotiations to determine differences in future trade conditions. US President Donald Trump agreed not to pick up new tariffs on Chinese goods and consider releasing a certain pressure on Chinese Huawei in exchange for greater imports of agricultural products from China.
In addition, the key differences between US and China on technology transfer and intellectual property rights are still unresolved and will be considered starting on July 2nd.
While the trade bargain between the two largest world economies, including the largest Australian client in China, was to meet Austrian customers, weaker than expected, PMI constrained optimism. Chinese PMI production in June dropped to 49.4 out of 49.5 forecasts, while non-productive PMI sparked 54.2 to 54.5, expected on Sunday morning.
Looking ahead, Australian HIA New Home Sales, Inflation TD Securities, and Chinese Caixin Manufacturing PMI could offer new guidelines for short-term trading sentiment. While the Aussie real estate market indicator fell by -11.8% during the previous issue, the inflation rate fell by 0.0% earlier. Furthermore, the Chinese production index could monitor official readings, and likely blink 50.0 compared to 50.2.
The 100-day exponential moving average (100-day EMA) at 0.7024 acts as current support for the par before the 0.7,000 and 21-day EMA levels of 0.6965 while the peak on April 30 is close to 0.7050 could reach a short-term advantage.