A broad based risk-off reaction to an SCMP...>

AUSSIE: A broad based risk-off reaction to an SCMP piece re: no progress in

U.S.-China deputy level trade talks has applied some weight to AUD/USD. The pair

last sits at $0.6713, 12 pips worse off.

- To recap, the rate mostly advanced through yesterday's Asia-Pac session, with

a stronger than expected PBoC fix providing support. That said, an early

downtick was seen after Australia's Westpac consumer confidence index hit a

four-year low. Headlines mentioning China's readiness to strike a partial trade

accord with the U.S. allowed AUD/USD to extend gains in London hours, but this

was negated by a subsequent recovery in the greenback's strength.

- From a technical perspective, an earlier break below $0.6724/23, the 23.6%

retracement of the Sep 12 - Oct 2 slide/Oct 8 & 9 lows, brings into view the low

of Oct 3 at $0.6702. Below there would expose the Oct 2 YtD trough at $0.6671.

Bulls need to recoup the $0.6723/24 area before setting their sights on $0.6757,

where the high of Oct 8 coincides with the 38.2% retracement of the

aforementioned Sep-Oct decline.

- On the radar today are Aussie housing finance data and consumer inflation exp.