Australian Dollar Holds Steady Amid US-China Trade Developments
The Australian Dollar (AUD) extended its gains against the US Dollar (USD) for the second straight day on Tuesday. Optimism surrounding a possible easing of trade tensions between the US and China supported AUD/USD. The ongoing meetings between US and Chinese advisors in London have improved market sentiment, lifting the Aussie.
Moreover, Australia’s Westpac Consumer Confidence rose by 0.5% month-over-month in June, though it marked a sharp slowdown from May’s 2.2% rise. Despite this, it was the second consecutive monthly increase, largely supported by the Reserve Bank of Australia’s recent rate cut. Hopes of easing inflation also contributed to the mildly positive consumer outlook.
The 4-hour chart for AUD/USD shows that the pair is trading within an ascending broadening wedge pattern, between the $0.6430 and $0.6600 levels. Despite the consolidation, the pair remains positive and is seeking upside momentum. However, the short-term rebound in US dollar strength has kept the upside limited in AUD/USD. A break above the $0.6600 area would likely trigger strong upward momentum.
