AUD/USD buyers catch a breath near 0.6820 with eyes on China GDP

  • AUD/USD seesaws around 0.6820/25 now after being the major performer on Thursday.
  • Contrasting the performance of the US/AU data helped Aussie on yesterday.
  • China’s GDP will be in the spotlight, for now, trade news will also be the key to follow.

Following Thursday’s rally, AUD/USD bulls await Chinese data for fresh directions while the pair takes the rounds to 0.6820 amid the initial Friday morning session in Asia.

A surprise decline in Australia’s seasonally adjusted Unemployment Rate challenged speculations of another rate cut from the Reserve Bank of Australia (RBA) and triggered the Aussie pair’s rise on Thursday.

Chinese Commerce Ministry’s commitment to end the trade war, coupled with the downbeat statistics from the United States (US), provided back-up to the pair’s rally to the strongest level in a month. Also adding to the sentiment was overall risk recovery after the United Kingdom (UK) and the European Union (EU) close in on the Brexit deal.

The risk-tone stays upbeat, which in turn supported the barometer AUD/USD and Wall Street. However, the US 10-year treasury yields stay little changed to 1.75% by the press time.

Although headlines concerning major risk drivers, namely trade/Brexit, will keep entertaining Aussie traders, immediate market attention will be on the top-tier data from the largest customer China, which is up for publishing the third quarter (Q3) Gross Domestic Product (GDP) and September month Retail Sales and Industrial Production (IP) releases.

Market consensus favors mild weakness in GDP figures coupled with upbeat IP and Retail Sales data, which in turn keep Aussie traders guessing the RBA’s next move. However, any upside surprises will be welcomed with zeal.

Technical Analysis

Not only the recent high of 0.6835 but a 100-day Exponential Moving Average (EMA) level of 0.6852 also acts as the key resistance for the pair before challenging September tops nearing 0.6900. On the downside, pair’s break below 0.6810/05 could revisit 0.6780 and 0.6755/50 rest-points.

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