AUD/USD sheds 10 pips after weak Aussie consumer confidence data

• AUD/USD is losing altitude in response to a dismal Westpac Aussie consumer confidence data. 
• Australian currency may remain under pressure due to deepening slowdown in China.

The AUD/USD pair is currently trading at 0.6852, having hit a high of 0.6863 in the run-up to the Australian data released at 00:30 GMT. 

The Westpac-Melbourne Institute Index of Consumer Sentiment fell 1.7% to 98.2 in September, having jumped to 3.6% to 100 in August from 96.5 in July. 

The drop in the consumer confidence comes after a day after the National Bank of Australia (NAB) reported a deterioration in both business confidence and the business conditions index and is hurting the AUD. 

The Australian currency may extend losses during the day on fading risk sentiment. As of writing, the futures on the S&P 500 are reporting a 0.10% loss. The index eked out marginal gains on Tuesday. 

The signs of deepening factory deflation in China will likely keep the AUD and other risk assets under pressure. China’s producer price index (PP) fell 0.8% in August from a year earlier, having dropped 0.3% in July, the official data released on Tuesday showed. 

Technical analysis

The pair created a Doji candle on Tuesday, snapping the five-day winning streak. The focus, therefore, is on today's close. 

A close below 0.6849 would confirm a bearish Doji reversal. On the other hand, a close above the Doji's high of 0.6870 would imply bullish continuation. 

Pivot points