Chinese Imports Much Lower - Australian Dollar Sells off

Overnight during the Asian Session on Febrary 9th 2012 at 22:04 EST(February 10th 2012 at 3:04 GMT) the Trade Balance, Imports and Exports data was released from China. It generally had lower estimates but the Import data came out much lower than expectations. As Australia sells alot of commodities to China the Australian Dollar sold off.

Here is the data:

China Exports YoY%
Estimates- Median: -1.4% Average: -0.2% Range: -10.0% to +8.4%
Actual: -0.5% Prior: +13.4% No Revision

China Imports YoY%
Estimates- Median: -3.6% Average: -2.4% Range: -14.0% to +11.0%
Actual: -15.3% Prior: +11.8% No Revision

China Trade Balance (USD)
Estimates- Median: $10.40B Average: $9.77B Range: -$0.43B to +$21.30B
Actual: +27.28B Prior: +$16.52B No Revision

Here is the 5 minute chart of the AUDUSD forex pair. The move lower actually started about 23:00 GMT or 18:00 EST just ahead of the Tokyo open, so there may have been some anticipation of this. After the data was released the pair sold off another 60-70 pips:

Here is a 1 hour chart of the EURAUD trade. Going short this pair is the Carry Trade of choice at the moment, because of problems in Europe and still better interest rates in Australia of 4.25%. Europe is just 1% but even though there is lower interest rates elsewhere this gives extra appreciation due to the European Soverign Debt Crisis.

Although this retacement looks quite good if you look at the Daily Chart you see that this is only a shallow retracement relative to the longer term: