AUD/USD extends recovery after upbeat China data

• AUD/USD is extending its recovery from seven-month lows after upbeat China data. 
• China PMI bettered estimates but remained below 50.00. 
• The US Federal Reserve cut rates on Wednesday, but dashed hopes of further easing in the near-term. 

AUD/USD is extending the recovery from seven-month lows hit earlier today, courtesy of an above-forecast China data. 

The currency pair is now trading at 0.6852, representing marginal gains on the day. The pair printed a low of 0.6828 earlier today, a level last seen on Jan. 3. 

China’s Caixin Manufacturing PMI (Jul), which focuses on small and medium-sized export oriented units, came in at 49.9, bettering the estimate of 49.6 and up from the previous month’s print of 49.4. 

A combination of a better-than-expected China data and a bullish divergence of the 4-hour chart relative strength index is boding well for the Aussie Dollar at press time. 

The gains, however, could be short-lived, as the US Federal Reserve cut rates on Wednesday but dented expectations of further near-term easing. 

Also, China’s PMI bettered estimates, but remained in contraction territory below 50.00. 

Pivot points