AUD/USD: will the 10-D SMA give and allow room to 0.7780?

• AUD/USD can't convince above key 10-D SMA.
• AUD/USD bulls need a break of 0.7780.

AUD/USD hit a brick wall just threw the 0.77 handle in its recovery attempt from in the 0.7660's. This intra-day low was made during the European am on risk aversion after China announced its additional tariffs on U.S. goods which is not good for the Aussie considering its close correlation to trade, commodities and China. 

AUD/USD traded up to 0.7695 in immediate reaction to Aussie Retail Sales and headed as high as 0.7717 before closing Asia below the 0.77 handle, without even a look in at the key resistance higher up around 0.7745 where 21-day MA and 38.2 of 0.7916/0.7643 converge. 

Is the Cold trade war about to turn hot; what are the implications for FX? - ING

Analysts at ING explained their immediate reaction to China news corroborates what we expected for currency markets in a cold trade conflict:

"The Japanese yen seems to be the best vehicle to hedge for escalating TradeWar (target 100)
The Swiss franc, euro, and sterling are up against a politically weak dollar
The Australian and Canadian dollar are a proxy sell for US-China trade tensions while the New Zeland dollar is a relative haven in the commodity space
Other markets showed a typical risk-off response initially: Treasury yields were lower, gold went higher, US stocks declined by around 1.5-2.0% on open. However, the follow through to FX markets has been limited."

The rebound, however, on Wall Street today has lifted the spirits of the higher beta community and commodity sector.  The Dow was paring its 500-point opening tumble by more than half on the back of consumer-related stocks in recovery. This has helped to reduce some of the depth in early declines int he market associated with trade-war fears. 

AUD/USD levels

The pair is making hard work of a recovery through the 10-D SMA and through the 0.77 handle, but daily closes below the former resistance at 10-D SMA ahead of the 76.4 Fibo at 0.7651 and a break below 0.7643 would set off a test of the 0.75 handle. On a break higher through 0.7780, and through the rising 200-D SMA just above the 0.78 handle,  0.7910 is open.