AUD/USD hits 27-month low, below mid-0.7100s

   •  Investors looked past today’s upbeat Aussie GDP growth figures.
   •  Resurgent USD demand prompts some aggressive selling at higher levels.
   •  US-China trade tensions further collaborate to the bearish pressure.

The AUD/USD pair extended its retracement slide from an intraday high level of 0.7218 and dropped to a 27-month low during the early European session.

With investors looking past today's upbeat Aussie Q2 GDP growth figures, resurgent US Dollar demand prompted some aggressive selling and was seen as one of the key factors exerting pressure on the major.

This coupled with concerns over trade conflict between the world's two largest economic benefitted the USD's safe-haven status and further collaborated to the pair's sharp intraday slide of around 60-65 pips.

Deadline for new US tariffs on additional $200 billion worth of Chinese imports was set to end on Thursday and was eventually seen weighing heavily on the China-proxy Australian Dollar. 

Meanwhile, a subdued action around commodity prices, especially copper, did little to lend any support to the commodity-linked Australian Dollar and stall the ongoing bearish slide to the lowest level since May 2016.

Technical levels to watch

A follow-through selling pressure is likely to drag the pair further towards testing the 0.7100 handle, though near-term oversold conditions might help limit further downside. On the upside, any meaningful recovery attempts might now confront fresh supply near the 0.7200 handle and is closely followed by resistance near the 0.7215-20 region.