FxWirePro: AUD/USD firms as hopes build for U.S.–China trade truce

• AUD/USD firmed on Thursday as hopes of progress in U.S.–China trade discussions underpinned risk appetite and supported the Aussie.

  • U.S. President Donald Trump met Chinese President Xi Jinping at a South Korean air base on Thursday to discuss a potential truce in the ongoing trade war between the world’s two largest economies..

• Trump has voiced optimism about striking a deal with Xi during their talks on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, encouraged by Wednesday’s breakthrough in trade negotiations with South Korea.

•The trade war flared up again this month after Beijing moved to sharply expand restrictions on exports of rare-earth minerals, key components in high-tech manufacturing where China holds a dominant position.

·  Given Australia’s strong export ties to China, investors often treat the Australian dollar as a liquid proxy for global trade sentiment and risk appetite.

• Immediate resistance is located at 0.6606 (38.2%fib), any close above will push the pair towards 0.6528(Higher BB).

• Support is seen at 0.6563(38.2%fib) and break below could take the pair towards 0.6535(SMA 20).

 Recommendation: Good to buy around 0.6590, with stop loss of 0.6520 and target price of 0.6640