AUD/USD: Bears making a comeback on softer China CPI?

The AUD/USD pair is seen wiping-out gains following the release of mixed China and poor Australian home loans data.

AUD/USD eyes 20-DMA

Currently, the AUD/USD pair now trades modestly flat at 0.7644, having met strong offers above 0.7650 barrier. The bears are seen fighting back control after the weak macro news from China and Australia, capping a minor-recovery staged by the Aussie from near 0.7635 region.

China CPI eased 1.3% y/y in Aug, coming in weaker than 1.7% expected and 1.8% last, with the monthly reading at 0.1%. While the PPI stood at -0.8% y/y, which was slightly higher than -0.9% expected and -1.7% prior. Separately the Australian home loans m/m witnessed a sharp drop, coming at -4.2% vs -1.5% expected and 1.7% last.

Going forward, the AUD/USD pair is likely to take cues from the broader markets and oil-price action amid a lack of significant fundamental drivers in the day ahead

AUD/USD Levels to watch   

The pair finds the immediate resistance at 0.7691 (Sept 6 high) above which gains could be extended to the next hurdle located at 0.7750 (round figure). On the flip side, the immediate support located at 0.7601 (20-DMA). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7585 (Aug 22 low).