- 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).