Australian Retail Sales missed expectations in February, according to preliminary estimates. The poor tone of global indexes and higher US Treasury yields weighed on the pair.
The Aussie pair finished the week unchanged in the 0.7730 price zone after dropping at the end of the week due to renewed US dollar’s demand. The AUDUSD was struck by weak data, as the preliminary estimate of February Retail Sales resulted at -1.1%, missing the expected 0.4%. The poor tone of global equities and US Treasury yields holding near one-year highs maintained the pair under pressure. Australia will not publish macroeconomic data at the beginning of the week.
On the daily chart, the pair shows a bearish to neutral trend. AUDUSD is developing below a mildly bearish 20 SMA (Simple Moving Average) but higher than bullish longer ones. The Momentum indicator has turned steeply lower but holds within neutral readings, while the RSI indicator heads marginally lower at around 48.
In the near-term and according to the 4-hour chart, the technical picture is quite alike, as the pair settled below all its moving averages, restricted to a tight 10 pips range, while technical indicators turned slightly lower, the Momentum around its midline and the RSI at 45. Chances of a steeper decline will increase on a break below 0.7690, the immediate support level.
We remain short due to the US Dollar strength continuation and demand.
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