- Australia’s Trade Balance and Building Permits rose more than expected in May month.
- Trade tension, likely extended flow of monetary easing from top-tier central banks seem weighing on market sentiment.
Even if Australia’s trade and housing numbers grew beyond market consensus in May, the AUD/JPY pair failed to recover while it flashes 75.17 during the early Asian session on Wednesday.
Latest data suggest that Trade Balance crossed 5,250 million forecast with 5,745 million mark as exports topped 2.00% prior with 4.00% and imports rose 2.00% versus 3.00% earlier. Further, Building Permits cleared 0.0% forecast on MoM basis while registering an increase of +0.7%.
The Australian Dollar (AUD) recently gaining traction from the Reserve Bank of Australia’s (RBA) statement refraining to give a clear go for further rate cuts.
However, the absence of developments surrounding the US-China trade truce and latest trade tension between the US and the EU weighed on the market sentiment that the AUD and the USD are both parts of.
US Dollar (USD) had to bear the additional burden of comments from the White House Trade Advisor Peter Navarro that favored expectations of easy monetary policy from the US Federal Reserve and raised doubts of a breakthrough from the US-China trade talks.
Technical Analysis
Having slipped beneath 21-day exponential moving average (21-D EMA), sellers can take aim at multiple highs marked during late-June around 74.80 ahead of looking for June month low of 73.92.
Alternatively, May 20 top of 76.40 acts as the key upside resistance to watch during the pair’s increase as a break of which can propel prices to 76.80 and 77.24 numbers to the north.
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