- Aussie manages to halt risk-off slide during Wednesday pre-markets.
- Aussie GDP, RBA Lowe, Gary Cohn all weighing heavily on AUD/USD.
The AUD/USD has reclaimed some lost ground following earlier’s Cohn resignation and is currently testing near the 0.7800 level.
The Aussie has rebounded in Tokyo trading after facing a decline during the overnight session. The pair came off Tuesday’s high after a speech by the Reserve Bank of Australia’s (RBA) governor, Philip Lowe failed to deliver anything new, with the big market dropper being the announcement that Donald Trump’s top economic advisor, Gary Cohn, is resigning from his position within the White House.
RBA governor Lowe failed to impress markets with his speech, where he highlighted many of the factors currently bogging down the Australian economy that most traders already know about: the uneven pricing in real estate, unsustainably high levels of household debt, and a lack of growth in real wages are all doing their part to keep inflation depressed, leaving the Australian economy to lag behind global growth trends. Aussie GDP figures missed in early Wednesday markets, but a disappointment from the AUD had already been priced in, and markets were still reeling from Cohn’s resignation.
Little remains on the Aussie data docket this week until Thursday’s mid-tier Trade Balance figures drop at 00:30. Analysts are anticipating a trade deficit of A$2.37 billion, a deeper contraction into deficit territory over the previous figure of A$1.35 billion. With no other data scheduled this week, the Aussie is set to continue to twist at the hands of market sentiment swings.
Price action is still tending towards the 200-day SMA as the pair struggles to make new ground in either direction, and H4 charts show the pair may be setting up a lower high from 0.7830. Intraday support is coming from 0.7760 and 0.7725, with resistance at 0.7840 and 0.7890.