AUD/USD analysis: quick recover from below 0.76 ahead of Australian Q1 GDP

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7622

Australian economy expected to have grown 0.9% in the three months to March.
AUD/USD poised for a bullish breakout after quick recovery on a dip below 0.7600.

The Aussie spent most of this Tuesday under pressure, hit by poor local data and a dovish outcome of the latest RBA monetary policy meeting. News indicated that the country's account printed at -$10.5bn in Q1, following outcomes in the previous quarters while worse that market's estimate of -9.95B. As for the RBA, the central bank left its cash rate unchanged at 1.5%, reiterating that the sluggish wage growth and inflation at the lower end of the target range were behind such decision and that low interest rates continue to support the Australian economy. What cached market's attention is that RBA removed a line from the statement, the one saying that "the Australian dollar has depreciated a little recently," somehow hinting that they are comfortable with the AUD/USD around 0.75. The pair fell as low as 0.7591 amid the tepid performance of US equities, but bounced back ahead of Wall Street's close, recovering the 0.7600 threshold. Australia will release its Q1 GDP. The economy is expected to have grown 0.9% in the three months to April, well above the previous 0.4%. The annual reading has been forecasted at 2.8% from the previous 2.4%. Given the latest bounce, numbers in-line or above expected could give the Aussie the needed impulse to reach new highs. Technically, 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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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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