- AUD/USD extends range trade on the day as upbeat China trade data fails to impress Aussie bulls.
- China reported a bigger-than-expected trade surplus for June as imports declined by a big margin.
- Trade Balance (USD) June came in at 41.60B versus 27.60B expected and 24.92B previous.
- Exports (YoY) rose +11.3% vs. +10.0% expected and +12.6% last. While imports (YoY) were up +14.1% vs. +20.8% expected and +26.0% last.
- Rise in China's trade surplus could lead to a further escalation of a trade war between the two biggest economies of the world.
- Technically, we see that the major trend remains bearish. We see bullish reversal only on decisive breakout above 110-EMA at 0.7580.
- The major finds stiff resistance upto 0.7425 (21-EMA). Upside for now remains capped below 5-DMA at 0.7422.
- Bullish divergence on RSI and Stochs keeps scope for upside. Break above 21-EMA will see test of 55-EMA at 0.7497.
- Rejection at 21-EMA could see dip till 0.73 levels (major trendline support). Breach there could see major downside.
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at 97.3599 (Neutral), while Hourly USD Spot Index was at 78.4536 (Neutral) at 0345 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
