• AUD/USD initially dipped on Monday but recovered some ground as investors assessed President Trump's warning of imminent tariffs on steel and aluminium imports.
• Trump announced a 25% tariff on all steel and aluminium imports, effective later today, with additional tariffs to be disclosed on Tuesday or Wednesday.
• Australia is not a major steel and aluminium exporter to the U.S., but its top trading partner, China, will be impacted by these new tariffs.
• The Aussie is frequently used by investors as a liquid proxy for China risk and to hedge against fluctuations in the yuan.
• Immediate resistance is located at 0.6322 (Higher BB), any close above will push the pair towards 0.6359(50%fib)
• Strong support is seen at 0.6237(38.2%fib) and break below could take the pair towards 0.6161 (Lower BB).
Recommendation: Good to sell around 0.6290, with stop loss of 0.6360 , and target price of 0.6200
