AUD/USD analysis: Chinese imports weigh on Aussie

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7871

Despite ongoing dollar's weakness, the AUD/USD can't attract buyers.
Softer-than-expected US data could reverse the ongoing sentiment in the pair.

The FX board is all about dollar's sell-off this Friday, but technical weigh more on the AUD/USD pair, at least for now. The pair hit 0.7904 in the European morning after the EUR broke higher on news German's coalition talks are moving on. The Aussie reacted to Chinese data released overnight, which was mixed as in dollar terms, the December total trade balance posted a larger-than-expected surplus of $54.69B, beating expectations of $37.0B. Exports rose 10.9% but Imports, yearly basis, were a huge disappointment, up just 4.5% from the previous 17% or the expected 13.0%. Softer imports from Australia's largest buyer is the main reason why the pair trades in the red, despite broad dollar's weakness.

Technically, the 4 hours chart shows that the price holds above a directionless 20 SMA, while technical indicators ease within positive territory, far from indicating an upcoming slide but clearly indicating limited buying interest. Despite briefly surpassing October's high, the upside continues to be limited by the 0.7900 price zone. Dollar's selling may resume if upcoming US retail sales and inflation figures miss expectations, sending the pair then closer to the 0.8000 threshold.

Support levels: 0.7830 0.7800 0.7770

Resistance levels: 0.7900 0.7945 0.7990

View Live Chart for the AUD/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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