AUD/USD: Above-forecast Aussie trade surplus struggles to power gains in the Aussie

AUD/USD is flashing red at press time as the Aussie dollar is struggling to find takers despite the above-forecast Australian trade surplus data. 

Australia's January trade surplus came in at A$ 5,210 million, beating the estimate of A$ 4,800 by a big margin. So far, the Aussie dollar hasn't found bids, leaving the AUD/USD pair in the red at 0.6620. The failure to cheer the data could be associated with the fact that the rise in the surplus is not fueled by export growth. Also, the trade surplus narrowed slightly from December's figure of A$ 5,223 million.

The outbound shipments or exports fell by 3% following December's 1% rise. The inbound shipment or imports also fell by 3%, having risen by 2% in the preceding month.

The drop in exports isn't surprising, as the sentiment in the global market had begun weakening in January with the outbreak of the coronavirus in China. Also, investors seem to have come to terms with the possibility of a marked slowdown in the Australian economy in the first quarter and currently appear focused on coronavirus outbreak in the US. That is evident from the fact that the AUD/USD pair rallied for the third straight session on Wednesday. 

As a result, the AUD/USD pair could soon turn green and challenge resistance at 0.6645. The risk reset in the broader market is supportive of gains in the AUD. The US lawmakers reached an $8.3 billion emergency coronavirus bill aimed at fast-tracking research and development for treatments and a vaccine, sending stocks higher. Investors also put a bid under stocks in response to Joe Biden’s victory on Super Tuesday. He is more market-friendly than Bernie Sanders and less likely to raise taxes. As a result, the S&P 500 rose by 4.53%. 

Technical levels