One of the main events of yesterday was the decision of China to impose retaliatory duties from June 1 to import goods from the US in the amount of 60 billion dollars. The fact that the trade war between Washington and Beijing is gaining new momentum was clearly from almost all forex news of recent weeks.
Last week, the next round of the US-China trade negotiations ended in nothing, and investors began to suspect the approaching “retaliatory strike” of China.
The fact that a new round of trade war between the two leading economies of the world will lead to unpredictable consequences for many currencies is understood by many traders. One of the most vulnerable of these is the Australian dollar, which is highly dependent on the state of the Chinese economy due to the close trade links between the countries.
At the moment, AUD has not reacted negatively to the statements of China, as well as to the challenging releases of fundamental statistics, released today. But things can change as European and American marketplaces awaken.
The NAB business confidence index increased from 0 to 1 in April, which was in line with forecasts. According to the NAB survey, in April, the business conditions index fell by 4 points to +3, and the decline was due to a fall in a number of components:
- The employment index fell to -1, while the sub-indices of trade and profitability fell by 4 points,
- Despite the increase in business confidence by 1 point, the index remained well below average.
- Progressive indicators also remained in the red, indicating that the future negative sentiment of investors.
The Australian dollar rose from 0.69530 to 0.69543. At the time of writing, the Australian dollar rose 0.13% to 0.6953 dollars.
Trading recommendations for the AUDUSD: Buy. Entry point– 0,6953. Take Profit – 0,6974. Stop Loss – 0,6917.
The Japanese yen has already shown its reaction to the news from China. Early this morning, JPYUSD moved from 109.201 to 109.17. From the fundamental statistics for the yen, we highlight the increase in the current account balance, which increased from 2.677 trillion yen to 2.848 trillion in March, which is less than the previously predicted 3.161 trillion yen. The adjusted current account surplus fell from 1.96 yen to 1.27 yen. The forecasts were more optimistic - at the level of 1.71.
Forex trading recommendations:
USDJPY: Sell. Entry point – 109,60. Take Profit – 109,45. Stop Loss – 109,85.
USDCAD: Buy. Entry point– 1, 3469. Take Profit – 1, 3486. Stop Loss – 1, 3440.
NZDUSD: Buy. Entry point – 0, 6585. Take Profit – 0, 6600. Stop Loss – 0, 6559.
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