AUD/USD weakens back below 0.74 handle; reverse Tuesday's up-move to 1-week tops

   •  Weaker Chinese trade balance data triggers the initial leg of downside.
   •  Goodish pickup in the USD demand further contributes to the selling bias.
   •  US-China trade-related headlines aggravate the downslide in the past hour.

After an initial uptick to 0.7435 area, the AUD/USD pair met with some fresh supply and has now erased all of its overnight gains to one-week tops.

Today's weaker than expected Chinese trade balance data triggered the initial round of selling around the China-proxy Australian Dollar. The downfall picked up pace since the early European session and was being weighed down by some renewed US Dollar buying interest. 

The latest leg of downtick over the past hour or so, dragging the pair back below the 0.7400 handle, could also be attributed to trade-related headlines, wherein China responded to a new set of US tariffs and slapped a retaliatory tariff of 25% on 333 US products.

This coupled with a weaker tone around copper prices, which tend to undermine demand for commodity-linked currencies - like the Aussie, further collaborated to the pair's ongoing downfall to an intraday low level of 0.7383. 

In absence of any major market moving economic releases, the pair remains at the mercy of broader market sentiment surrounding the greenback and might continue to be influenced by the incoming trade-related news/developments.

Technical levels to watch

Any subsequent fall is likely to find support near the 0.7360-55 region, below which the pair is likely to aim towards testing YTD lows, around the 0.7310 region. On the upside, momentum beyond 0.7420 level might continue to confront resistance near the 0.7440-50 region, which if cleared might trigger a short-covering bounce towards reclaiming the key 0.7500 psychological mark.