Saturday, March 17, 2018
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AUD/USD fails to catch a bid on strong China trade data
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  • China trade surplus widening in February.
  • Aussie dollar hardly moves.
  • Dull reaction likely due to fears of a trade war.

China trade surplus rose CNY 224.9 billion in February as exports surged 36.2 percent and the imports dropped 0.2 percent. The consensus estimate had called for a deficit of CNY 70 billion.

The positive surprise has not put a bid under the Aussie dollar so far. The pair continues to trade largely unchanged at 0.7827 – the level seen before the data release. The dull reaction could be associated with fears that Trump’s tariff plan and the resulting trade wars would be a net negative for the small and open economy like Australia.

It is worth noting that Australia also reported better-than-expected trade numbers earlier today.The AUD did find bids post-Aussie data release, but the up move ran into supply around the descending trendline resistance (drawn from the Jan. 31 high) and Feb. 16 high).

AUD/USD Technical Levels

A break above 0.7840 (descending trendline resistance) would open up upside towards 0.7868 (Feb. 27 high) and 0.7894 (50-day moving average). On the downside, a move below 0.7815 (session low) could yield a pullback to 0.7771 (100-day moving average). A violation there would expose support at 0.7712 (Mar. 1 low).

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