Aussie trades flattish despite disappointing Chinese data

17 / 04 / 2018
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The Australian dollar was trading without any significant change on Tuesday and was hovering around 0.7770 during the London session.

Earlier in the day, Chinese GDP met estimates and printed 6.8% year-on-year. However, fixed asset investments slowed notably to 7.5% on the yearly basis, down from 7.9%. Analysts had expected 7.7%. In addition, industrial production also deteriorated markedly from 7.2% to 6.0%. On the positive side, retail sales improved to 10.1% from 9.7% scored in the previous month.

The US session will offer building permits and housing starts, which should improve month-on-month. Furthermore, capacity utilization rate and industrial production are due and investors expect a slight decline in these two indicators.

Markets will also pay attention to some Fed speakers, which are scheduled to speak tonight, including Williams, Quarles and Bostic. These speeches could also cause some volatility on the FX market.

The AUDUSD pair failed to breach the resistance at the 200 day moving average last week and this week it has failed to jump above the 100 day moving average. Therefore, the short-term trend appears bearish as long as the Aussie trades below these levels.

On the other hand, the first support is located at 0.7740 and if not held, the pair might decline toward 0.7715 in the initial bearish wave. However, intraday volatility could be lower as the Aussie did not react heavily on the Chinese macro numbers and the US calendar doesn’t include any major news. In all cases we strongly recommend to have rigorous money and risk management.

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