Commodity currencies such as the Australian dollar will be under pressure with the latest reports on tensions between the United States (US) and China while giving the US dollar an advantage over the market.
The US ambassador is scheduled to visit Taiwan next week to meet with his counterparts for talks.
Tensions between the two world giants have risen this week following the delisting of Chinese telecommunications companies on the New York Stock Exchange (NYSE).
The US dollar also gained strength to recover following the risk-averse sentiment at the Capitol.
But analysts expect that when the situation calms down, the US dollar will move weaker after Georgia's election in favor of Democrats, which will increase Joe Biden's support in the Senate with broader expectations of economic aid.
On the AUD / USD currency pair chart, the decline began to show on Thursday trading but the price is still moving in a bullish trend.
The decline was seen as the price dropped from the resistance zone 0.78200 and tested the RBS zone (resistance become support) around 0.77400.
However, the initial signal for a bearish trend change is seen after the price moves lower below the Moving Average 50 (MA50) barrier level on the movement in the 1 hour time frame.
In the Asian session this morning, the price is still moving below the MA50 barrier from 0.77700.
Continued risky market sentiment will push the price lower towards the RBS zone (resistance become support) 0.76500 before moving to the lower zone at 0.75700.
However, if the price manages to make a surge, the resistance zone 0.78200 will be tested again and the investor will assess whether the price is able to break through the zone to record the latest price level.
