AUD/USD remains flat lined around 0.7420 after Aussie trade data release

The official data released today in Asutralia showed the trade surplus narrowed in March on the back of a sharp rise in the imports.

However, that has had little impact on the AUD/USD pair, which continues to trade in the sideways manner around 0.7420 levels.

Focus on iron ore and copper prices

The March trade deficit is backward looking indicator, especially as the prices of the key exports – iron ore and copper are taking a beating now, suggesting the trade numbers could worsen in the near future.

Dalian ore futures opened 6.9% lower today. Meanwhile, copper prices dropped almost 3.5% on Wednesday. Gold prices dropped as well and currently trade around $1242/Oz; down 0.5% on the day.

A weaker-than-expected China Caixin services PMI release (actual 51.5, expected 52.6) did little to help the AUD.

The currency remains at the mercy of the action in the commodity prices. RBA governor Lowe’s speech could offer clues into the next move at the central bank and may move AUD pairs.

AUD/USD Technical Levels

A break below 0.7407 (weekly 100-DMA) would open up downside towards 0.7311 (Nov low) and 0.7300 (zero levels). On the higher side, breach of 0.75 (zero levels) could yield a re-test of 0.7553 (200-DMA). A daily close above the same would revive the bullish view and open doors for 0.7610 (Apr 17 high). Note, the daily RSI has failed yet again to cut through 50.00 levels and is now sloping downwards, suggesting more losses ahead.