FXstreet.com (Barcelona) – The morning release of trade data in China during the month of June today presented a mixed outlook on the macro front, however the details brought unequivocally bad news for the Australian dollar.
Although the trade balance was much stronger than expected at USD $31.72B (cons. USD $24B), imports in general grew modestly, and imports of iron ore in particular were down -8.6% month in month. According to Strategy Analyst Geoffrey Yu at UBS, “A monthly decline on this scale is not unheard of and is still within the realm of monthly statistical variation, however it could be the first sign of cooling Chinese demand for Australian commodities and AUD/USD saw some slippage on the headlines”.
In terms of the AUD/USD, “We remain staunchly neutral on the pair, with strong near-term support is at 1.0145, and followed at 1.0108, while resistance is located at 1.0329. Our one month outlook is 0.9700, and 0.9500 after three months” he adds. The pair is currently trading at 1.0230, up +0.22% in the afternoon of European trading.