- AUD/USD pulls back from a five-month top of 0.6984 despite upbeat Aussie data.
- US President Trump refrained from negative comments during early-Asia.
- Market’s risk-tone seems to consolidate the previous day’s strength ahead of the ECB, US Jobless Claims.
Despite witnessing upbeat Aussie data, AUD/USD drops to 0.6898, down 0.31% on a day, during the early Thursday. The reason could be traced from the US dollar pullback from multi-day high as well as market’s risk consolidation ahead of the key events.
Australia’s April month Retail Sales recovered from -17.9% initial estimation to -17.7% whereas Trade Balance grew past-7500M forecast to 8800M.
Given the preliminary readings of the Retail Sales already out and loud, markets showed a little reaction to the data.
Also compressing the pair’s momentum could be the lack of major catalysts before the European Central Bank (ECB) monetary policy meeting and the US Jobless Claims.
As a result, the trading sentiment loses the previous day’s upside momentum. Also affecting the trading mood could be the news that the US levies additional restrictions on Chinese media outlets.
On the contrary, US President Donald Trump refrained from any major negative comments during his early-day interview with Newsmax. The Republican leader showed readiness to not use the further military to tame the protests at home while also stepped back from any sanctions on the Chinese President Xi Jinping, as far as the Hong Kong issue is concerned.
While portraying the mood, the US 10-year Treasury yields decline 1.7 basis points (bps) to 0.74% but stocks in Asia-Pacific remain mildly positive on hopes of further stimulus from Europe.
In addition to the calendar data/events, traders may also keep eyes on the US-China tension and hints of further economic recoveries to forecast near-term Aussie moves.
Technical analysis
Not only 0.7000 round-figure but December 2019 peak surrounding 0.7045 also adds to the upside barriers for the pair. As a result, sellers may emphasize more on the overbought RSI conditions to revisit the early-January lows near 6850.
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