AUD/USD weighed down by weaker Chinese data

Weaker-than-expected Chinese economic data dragged the AUD/USD pair further from multi-month high near 0.7750 region touched on Wednesday. 

Being Australia's largest trading partner, Chinese economic data has a lasting effect on the Aussie. Disappointing Chinese data weighed on investors sentiment, forcing a profit-taking move after the pair's recent rally of over 250-pips from last week's RBA-led swing low of 0.7487. 

Friday's releases showed Chinese industrial production for July slowing to 6% y-o-y vs 6.1% expected and previous 6.2%. Meanwhile, retail sales stood at 10.2% on yearly basis vs 10.5% expected and June's 10.6%.  China's fixed asset investment (excluding rural) YTD came at 8.1% vs 8.9% expected and 9% last. 

Going forward, today's US economic releases would now provide fresh clues over the possibilities of an eventual Fed rate-hike action later during this year and provide fresh impetus for the pair's near-term trajectory.

Technical levels to watch

Sustained weakness below session low support near 0.7665 area seems to drag the pair immediately towards 0.7625-15 support area. Break below 0.7625-15 support is likely to extend the corrective move towards its next major support near 0.7535 area.

On the flip side, 0.7700 handle now seems to have emerged as immediate strong resistance. A sustained move and close above 0.7700 handle now seems to pave way for extension of the pair's near-term upward trajectory, even beyond 0.7755 swing high resistance, towards April highs resistance near 0.7800 region.