Regains Lost Ground

After gaining ground through the session yesterday, AUD/USD has given some back so far in Asia, the pair last down 12 pips at 0.7734.

• AUD could see some upward pressure from dividend season, which gets into full swing this week. CBA writes: "BHP pay their dividend today in USD. That might cause some modest AUD buying today as Australian owners swap their USD dividends for AUD. But it is unlikely to be a big driver of AUD. On Wednesday, FMG pay their dividend in AUD. That might cause some modest AUD selling as foreign owners swap their AUD for foreign currencies such as USD and GBP. AUD/GBP is relatively Illiquid in the Australian trading day so has more potential to move in our view."
• There could be headwinds though, from lower iron ore imports in China. Data from customs showed China's iron ore imports from Australia fell to 51.5 million tons in February, hitting the lowest for a year. The data also showed China recorded no imports of Australian coal in February, the third month in a row, as its ban on some Australian commodities remains in place.
• From a technical perspective AUD/USD found resistance last week at 0.7849, Mar 18 high This level marks an important S/T bull trigger where a break is required to resume the recent bullish cycle and suggest scope for an extension higher. This would open 0.7860, a Fibonacci retracement and beyond. On the downside, support 0.7699, Mar 17 low has been probed today. A break would expose the key support and bear trigger at 0.7621, Mar 9 low.
• A quiet economic docket today, markets look ahead to Markit PMI figures tomorrow.