- AUD hit 3.5 week low of 0.7863.
- Aussie Dec retail sales dropped more than expected.
- Trade balance record a deficit in Dec.
There appears to be no relief in sight for the Aussie dollar as the currency received negative news on the domestic front amid risk aversion across global financial markets.
- Australia retail sales dropped 0.5% in December
Australian Bureau of Statistics (ABS) reported a 0.5 percent drop in retail sales in December, suggesting consumption remained weak in the all-important festive season. Markets were expecting a 0.2 percent drop. Also, the previous month’s reading was revised higher from 1.2 percent to 1.5 percent.
Further, the trade balance recorded a deficit of AUD 1.36 billion in December compared to the AUD 0.2 billion surplus.
The Aussie dollar, which was already on the back foot, extended the losses to hit a fresh 3.5 week low of 0.7863. The AUD/USD pair was last seen trading at 0.7874 levels. The currency pair could remain flat-lined on account of caution ahead of the RBA rate decision.
- When is the RBA and how could it affect AUD/USD
AUD/USD Technical Levels
A break below 0.7818 (50% Fib R of Dec-Jan rally) would expose 0.7803 (50-day MA) and 0.7776 (100-day MA). On the other hand, a move above 0.7893 (38.2% Fib R of Dec-Jan rally) might weaken the bears and open doors for a corrective rally to 0.7952 (5-day MA) and 0.80 (psychological level)