Australian, NZ Dollars Gap Down After Chinese Data Disappoints
- AUD/USD and NZD/USD gapped lower at the beginning of this week
- Chinese Industrial Production missed expectations over the weekend
- DailyFX SSI remains net-long, implying further AUD/USD weakness
Having trouble trading the Australian Dollar? This may be why.
The sentiment-linked Australian and New Zealand Dollars gapped lower at the beginning of this week. Over the weekend, Chinese Industrial Production crossed the wires 6.0 percent year-over-year (YoY) versus 6.5% expected and 6.8% in March. The year-to-date (YTD) figures also disappointed coming in at 5.8% versus 6.1% expected and 5.8% prior. These readings can be important for the world’s second-largest economy as roughly 1/3 of its GDP is based on the manufacturing sector.
Meanwhile, the DailyFX Speculative Sentiment Index (SSI) is showing a reading of 2 for the AUD/USD following the announcement. This translates into 2 traders being long the AUD/USD for every 1 on the short side. The SSI is a contrarian indicator, implying further AUD/USD weakness ahead.
Want to learn more about the DailyFX SSI indicator? Click here to watch a tutorial.