AUD/USD was able to catch a bid later in the NY session, even making a mark above the 61.8 Fib of 0.8125-0.7501 as US yields drop after the long-dated auction. Currently, AUD/USD is trading at 0.7886, down -0.04% on the day, having posted a daily high at 0.7898 and low at 0.7886.
AUD/USD is now resting up and taking a breather just before the Tokyo open ahead of Chinese trade data, although, unless there is a mightly miss of expectations, traders are likely keeping the foot off the gas until the US CPI and to a lesser extent, retails sales have been revealed. (Recall that Aussie November retail sales popped +1.2%, the largest monthly increase since Feb 2013 vs mkts +0.4% forecast).
US CPI and retail sales previews
CPI preview: expect a strong rebound? - Nomura
"We expect a strong rebound of 0.3% (0.271%) m-o-m in core CPI in December (Consensus: 0.2%) following a disappointing reading of 0.117% in the previous month," - Nomura
Retail sales preview: what to expect? - Nomura
"We expect a robust 0.6% m-o-m increase in nominal core (“control”) retail sales in December (Consensus: 0.4%). Against the backdrop of low unemployment and elevated consumer confidence, consumer spending in December was likely strong," - Nomura
Meanwhile, AUD/USD bulls have set a new trend high and threaten to break the October 2017 high while the technicals lean bullish above the aforementioned clearing of the 61.8% fibo of 0.8125-0.7501.
Valeria Bednarik, chief analyst at FXStreet explained that "technical indicators have advanced to fresh one-week highs, maintaining their bullish slopes. The immediate resistance is the mentioned October high of 0.7896, with large spots suspected above it that once triggered will only fuel the dominant bullish trend."
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