- Summary:
- The AUD/USD pair retreated today after Australia released strong retail sales for November. Here's a quick look at why this happened.
The AUD/USD is down by more than 0.30% even after some strong economic data from Australia. The AUDUSD is trading at 0.7560, which is lower than this month’s high of 0.7638. It is also a bit higher than yesterday’s low of 0.7457.
What happened: The Australian statistics agency released relatively strong November retail sales numbers. The overall sales increased by 7.0% in November leading to an annualised increase of more than 13.2%.
These numbers were better than what analysts polled by Reuters were expecting. In its report, the agency cited the recent Black Friday event and the reopening of Victoria state.
Why did AUD/USD drop: On paper, it seems as if the Australian dollar declined. However, in reality, it is the US dollar that gained. Indeed, the dollar index is up by 0.25% today while the AUD/NZD. This price action is mostly because of the overall risk-on sentiment in the financial market because of the new strain of coronavirus.
What next: Later today, the AUD/USD will react to the US Q3 GDP data that will come out at 13:30 GMT. The numbers are expected to show that the American economy bounced back in the third quarter.
AUD/USD technical outlook
What next for the Aussie: On the three-hour chart, we see that the AUDUSD is under pressure. At the 0.7560 level, it is at the same level as the 25-day and 50-day exponential moving averages. It is also slightly above the ascending blue trendline that connects the lowest levels from November. Therefore, the pair will remain in an ascending trend so long as it is above this line.
AUDUSD technical chart
