- Aussie has flattened out heading into Asia markets, AU GDP figures inbound.
- Market risk sentiment corkscrewed on Tuesday, traders now waiting improved growth figures.
The AUD/USD is trading softly to the downside in early Asia trading for Wednesday, backing into the 0.7600 major handle ahead of Australian quarterly GDP figures.
Aussie GDP numbers for the first quarter of 2018 are due early Thursday at 01:30 GMT, and the recent upswing in key Australian economic data is leading analysts to now expect a higher number in the release, with the q/q figure now anticipated at 0.9%, compared with the previous reading of 0.4%. The year-on-year figure is also expected to print at 2.8%, bringing GDP growth much closer to the Reserve Bank of Australia’s (RBA) 3% target.
Tuesday turned into a down day for the Aussie, after the early week’s risk appetite shriveled in the face of bizarre turns of events in the ongoing trade war ramp-up, with US President Trump considering splitting NAFTA renegotiations into a pair of bilateral negotiations with Canada and Mexico, while the US Senate came together across party lines to begin drafting a bill that will block Trump’s ability to impose tariffs without Congressional consent.
AUD/USD levels to watch
Tuesday’s bounce from the day’s low at 0.7595 sees the pair back into the 0.7600 range after falling from the day’s high at 0.7655, and as FXStreet’s own Valeria Bednarik noted, the technicals are currently leaning towards more bullish action: “the 4 hours chart shows that the risk remains skewed to the upside, as the pair bounced from a bullish 20 SMA, while technical indicators have recouped their upward slopes within positive territory. Furthermore, the pair managed again to settle above the 50% retracement of its latest daily slump at around 0.7615, the immediate support.”
Support levels: 0.7615 0.7565 0.7505
Resistance levels: 0.7660 0.7700 0.7740
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