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AUD/USD: Struggling to find buyers amid USD strength

FXStreet (Bali) - AUD/USD kept on dropping last Friday, finding a new 7-month low at 0.8748 before a minor bounce, which occurs around the intersection with a major ascending trendline off July 2007 low, to currently stay at 0.8757.

There were some disappointing news out of China over the weekend, after China’s industrial profits falling by 0.6% in August YoY, vs + 13.5 in July, a setback that may add even further pressure to the AUD. The rising yields curve in the 10-year US bonds, directly correlated to AUD/USD performance, also suggests that the heaviness may prevail for now.

Jim Langlands, Founder at FXCharts, notes: "A break down of 0.8745/50 would see a run to minor supports at 4 Feb 2014 low at 0.8730 and then at the 31 Jan low at 0.8694. Below here will then want to take a look at the 24 January low at 0.8660, which should act as strong support... The topside looks a little limited as long as this US$ strength continues, but if we do see a squeeze higher we could get back to the descending trend resistance at 0.8800."

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