FxWirePro: AUD/USD extends sideways grind below 200-DMA, Aussie dampened on modest China GDP target

Chart - Courtesy Trading View 

Spot Analysis:

AUD/USD was trading 0.15% lower on the day at 0.6754 at around 08:00 GMT.

Previous Week's High/ Low: 0.6783/ 0.6694

Previous Session's High/ Low: 0.6774/ 0.6720

Fundamental Overview:

Aussie undermined as Beijing disappointed markets by setting a modest economic growth target for this year.

Chinese authorities on Monday set a modest economic growth target for 2023 of around 5%, denting the antipodeans. 

Investors also await the Reserve Bank of Australia’s (RBA) policy decision on Tuesday, where it is expected to raise interest rates by another 25 basis points.

Last month, the RBA delivered a 25bps hike, lifting the cash rate by an aggregate of 325 basis points since May 2022 and bringing borrowing costs to a 10-year high of 3.35%.

Investors turn cautious ahead of Federal Reserve Chair Jerome Powell’s congressional testimony on Tuesday and Wednesday.

Powell's speech will be close watched for further guidance on the US central bank’s tightening plans.

Technical Analysis:

- Price action is grinding sideways from the past few session's

- Recovery attempts capped at 200H MA

- GMMA indicator shows major trend is neutral, while minor trend is bearish

- Momentum is bearish and volatility is high and rising

Major Support and Resistance Levels:

Support - 0.6669 (Lower BB), Resistance - 0.6787 (200-DMA)

Summary: AUD/USD trades with a bearish bias. Price action is below cloud and major moving averages. Scope for further weakness. Bearish invalidation only on decisive break above 200-DMA.