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AUD/USD fails to resist 0.73 handle on poor Aus trade data

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 3, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The Aussie extends its retreat from fresh seven-week highs reached yesterday and fell further into losses in early Asia following the release of worse than expectations Australian trade balance data.

    AUD/USD drops below 1h 50-SMA

    Currently, the AUD/USD pair trades -0.33% lower at 0.7287, having posted fresh session lows at 0.7285 last minutes. The Australian dollar appears badly hit against its American counterpart this session after a slew of economic releases disappointed markets, with the latest one being the trade balance numbers.

    Australia’s trade deficit widened to A$$3.31 billion in October, compared to a revised A$2.40 billion in Sept, missing forecasts of a A$2.60 billion shortfall. Earlier on the day, new home sales were down 3.0% m/m in October, after sliding 4.0% the month before while the AIG services index dropped 48.2 against 48.9 booked previously.

    Moreover, the overnight slide in the commodity prices and the persisting risk-off sentiment on falling US and Asian stocks curbed the demand for higher-yielding currencies and thus, weigh on the Aussie.

    Meanwhile, markets now await the Chinese services PMI to throw more light on China’s economic conditions while a host of US macro releases and Fed Chair Yellen’s testimony before the Joint Economic Committee, in Washington, will be closely watched.

    AUD/USD Levels to watch

    The pair trades below 0.73 handle with the immediate support is seen at 0.7255/45 (1h 10-SMA/ 10-DMA). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7200/0.7196 (round number/ 50-DMA). On the flip side, the immediate resistance seen at 0.7365/66 (Oct 13 & 15 High), above which gains could be extended to the next hurdle located at 0.7416 (200-DMA).
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