AUD/USD dropped today and tried to approach and reach the 0.8042 former low. Price decreased and erased the morning gains, but the perspective remains bullish on the daily chart because the rate is located above important support levels.

The pair could climb much higher in the upcoming period, despite the minor correction. The retreat was somehow expected after the impressive rally. Price could retest the near-term support levels before will climb higher again. It is very important to see what will happen on the USDX in the upcoming period.The dollar index has found temporary support and has come back to test and retest a dynamic resistance.

The USDX moves somehow sideways, but unfortunately, this could be a distribution and the index will resume the downside movement. A further drop will send the USD much lower versus its rivals, right now is hard to believe that the dollar index will make a rebound at this moment, we don’t have any reversal sign.

The Aussie increased in the morning, even if the Australian and the Chinese data have disappointed in the morning. The Australian CPI increased only by 0.6%, less versus the 0.7% estimate, it has remained steady at 0.6% for the second quarter, the trimmed Mean CPI increased only by 0.4%, less versus the 0.5% estimate, while the Private Sector Credit  increased by 0.3%, less versus the 0.5% estimate.

The Chinese Manufacturing PMI decreased from 51.6 to  51.3 points, much below the 51.5 estimate, while the Non-Manufacturing PMI increased from 55.0 to 55.3 points.

The rate has dropped after the retest of the second warning line (wl2) of the minor blue ascending pitchfork. It could be attracted by the confluence area formed between the sliding line (SL) with the 50% Fibonacci line (ascending dotted line), a valid breakdown through this area will accelerate the sell-off. We may have a buying opportunity if the rate will test and retest the warning line (wl1) and if will stabilize above the descending dotted line.