AUD/USD lower still on trade balance but...

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 3, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Guatemala) - AUD/USD is meeting supply on the back of the Australian December trade balance that came much worse-than-expected at-3535m vs -2450m expected and -2906m last.

    The data offered the exports at -5% vs 1% last, while imports stood at -1%vs -1% last. This comes in line with the cautionary approach that the RBA have now adopted after "chilling-out" into the close of 2015 over the festive season.

    The Aussie tanked after the statement confirmed to markets that the RBA are leaving the door open to possible easing if necessary this year, while they are concerned for headwinds from abroad and while the Australian economy has been performing solidly, it is not immune and the turmoil at the start of the year certainly woke the Bank up out of the chill zone.

    For full details on the trade balance see here

    At the same time, however, which is where the "but..." comes in, there was a big jump in building approvals this month after a big slump the prior month. Australian December building permits came at 9.2% m/m vs 4.5% expected and -12.4% last, revised from -12.7%, while the y/y read stood at -2.5% vs 7.2% expected and -7.6% prior, revised from -8.4%.

    For full details on building approvals see here.

    AUD/USD levels

    The price is even lower within the recent bear trend as the price dropped below the overnight sideways channel support below the pivot of 0.709. AUD/USD has been held up at S2 at 0.7011 with a low so far of 0.7010 ahead of S3 at 0.6979. On a full reversal of the recent rally, 0.6774 is the 2004 low below 0.6920 that guards the 0.6828/29 recent lows.
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