Australian Dollar Declines as Consumer Sentiment Weakens Despite Robust Chinese Trade Figures

The AUD/USD pair slipped to around 0.7040 on Tuesday, as the Australian dollar failed to rally on the backdrop of stronger-than-expected Chinese trade data released earlier in the Asian session.

The currency’s advance was curtailed after Australia’s Westpac‑Melbourne Institute Consumer Sentiment Index dropped to –2.9 % in June, down from a previous reading of 3.5 %.

China reported a 19.4 % year‑on‑year surge in May exports, while imports jumped 27.4 %, underscoring solid external and domestic demand. These numbers initially buoyed China‑linked currencies, including the Aussie, given China’s status as Australia’s top trading partner.

The export boost was driven by high‑tech goods, semiconductors and AI‑related products, pushing China’s trade surplus to $105.43 billion in May.

Nevertheless, concerns linger over weaker momentum in non‑tech exports and the still‑fragile outlook for domestic consumption in China.

Short‑term technical analysis:

On the 4‑hour chart, AUD/USD is trading at 0.7042, maintaining a bearish short‑term bias as it remains below both the 20‑period and 100‑period simple moving averages (SMAs) at 0.7080 and 0.7136, respectively. The Relative Strength Index (RSI) sits in the mid‑30s, suggesting lingering downside pressure, though it is beginning to stabilize after recent oversold readings.

Resistance lies at 0.7047, with a stronger ceiling at 0.7063, followed by the 20‑period SMA near 0.7080 and the 100‑period SMA around 0.7136. Support is found just below at 0.7041, with a more substantial floor at 0.7033; a clear break beneath this level could trigger further declines in line with the prevailing bearish structure.

(The technical analysis of this story was written with the help of an AI tool.)

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