AUD/USD shrugs off downbeat Australia trade balance data
|- AUD/USD stays on the recovery mode ignoring weaker than forecast Aussie trade data.
- Risk-tone remains heavy amid global economic pessimism, trade tension.
- China’s holidays restrict market momentum, trade/political headlines will be followed for fresh direction.
Even after witnessing disappointing trade balance data, AUD/USD remains on the road to recovery while flashing 0.6715 quote amid early Thursday.
August month trade data suggests the headline Trade Balance grew less than 6,000M forecast to 5,926M whereas Imports and Exports also fell behind 1.0% and 3.0% gains to -3.0% and 0.0% respectively.
Earlier during the day, Australia’s September month AiG Performance of Services Index and Commonwealth Bank Composite PMI (Purchasing Managers’ Index) posted upbeat numbers but Services PMI from the Commonwealth Bank lagged behind 52.5 forecast and prior to 52.4.
The quote bounced off a decade low on Wednesday after fears of the US recession dragged the US Dollar (USD) down against the majority of its counterparts. Though, the gains were confined by the latest US-EU trade tussle and an absence of fresh clues from China due to the week-long holidays at the dragon nation.
It should also be noted that the latest White House Post weighs on calls of the US President Donald Trump’s impeachment while the US diplomat’s comments that the US-China trade talks are moving around Hong Kong issue offered fresh impulse to traders.
Risk sentiment stays under pressure with Wall Street closed in red for second consecutive day while the US 10-year Treasury yields seesawing near monthly lows.
Investors may now look forward to the US ISM Non-Manufacturing PMI data after the headlines Manufacturing PMI escalated the risk of a slowdown in the world’s largest economy. However, this doesn’t defy importance of the trade/political headlines to determine near-term pair moves.
Technical Analysis
Pair’s recent bounce needs validation from late-September lows close to 0.6740 in order to challenge a 21-day simple moving average (SMA) level of 0.6800 and early-August highs nearing 0.6820, failing to which could recall 0.6685 and 0.6670 rest-points while also highlighting 0.6600 during further declines.
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