The people of China started protesting in several major cities following the abolition of the zero-Covid policy because it was believed to be the cause of 10 deaths.
This is because the restrictive measures implemented are said to hinder efforts to rescue victims trapped in residential buildings that have suffered a fire.
The tense situation in the world's second largest economy also had a significant impact on financial market movements at the beginning of the week.
The US dollar showed a resurgence while high-yielding currencies such as the Australian and New Zealand dollars suffered losses that were naturally sensitive to the bad things that hit the Chinese economy.
It can be observed on the price chart of the AUD/USD currency pair, the price decline occurred on Monday yesterday after the price movement at the end of last week featured a horizontal pattern in the 0.67800 zone.
The price is clearly below the Moving Average 50 (MA50) barrier level on the 1-hour movement on the AUD/USD chart earlier this week as an indication of a bearish trend.
The drop in price until the end of yesterday's New York session has reached around 0.66400 before rebounding in the Asian session this morning (Tuesday).
The China State Council will hold a conference at 3pm local time with rumors that the zero-Covid policy will end.
Currently, the market's risk situation has eased a little, but the market still remains cautious expecting worse things to happen.
The price rebound is seen to test the 0.67000 focus level as well as being blocked by the MA50 level for investors to assess indications for further price movement.
If the price resumes its decline today, a break above the previously hit level of 0.66400 will then test last week's support level around 0.65900.
The continued decline will test the RBS zone (resistance become support) at 0.65400.
However, if the risks are easing, the price could resume the rising pattern in the Asian session just before the 0.67800 resistance zone will be tested again this week after failing to break through last week.
A successful continuation of the rally will mark the latest 11-week high with the next targets to aim for being at 0.68400 and 0.69000.
