AUD/USD eases from tops, still well bid near mid-0.6900s

• The recent US-China trade optimism continues to underpin the Aussie.
• The USD remains on the defensive amid increasing Fed rate cut bets. 
• The upside seems limited ahead of Trump-Xi meeting later this week. 

The AUD/USD pair remained well bid through the early European session and remained well within the striking distance of near two-week tops set earlier this Monday.

The pair built on last week's goodish bounce from multi-month lows, with a combination of supporting factors fueling the ongoing positive momentum for the fifth consecutive session.

The China-proxy Australian Dollar continues to benefit from the recent optimism over a possible resolution to the prolonged trade disputes between the world's two largest economies, especially after the US President Donald Trump last week said that he will have an extended meeting with his Chinese counterpart at the G20 summit. 

The bullish sentiment got an additional boost on Monday after the Reserve Bank of Australia (RBA) Governor Philip Lowe refrained from providing any hints about the central bank's future policy moves and said that the macro growth is still reasonable, albeit acknowledged downside risks to the global economic outlook.

On the other hand, the US Dollar continues to be weighed down by a more dovish shift by the FOMC, clearly indicating that it remains ready to cut interest rates by the end of this year to support economic growth and combat subdued inflationary pressure, and remained supportive of the bid tone surrounding the major.

However, in absence of any fresh fundamental triggers - in terms of any major market moving economic releases, the upside is likely to remain capped as traders now seemed reluctant to place any aggressive bets and preferred to wait on the sidelines ahead of the highly anticipated Trump-Xi meeting later this week. 

Technical levels to watch