Who’s looking at AUD/USD ahead of Australia’s quarterly CPI release?
If you are, then you’ll want to know where the pair is trading in the 15-minute time frame!
Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
In an interview on Monday, SNB Chairman Thomas Jordan said “Inflation went up, because of the VAT increase and electricity prices…but it shouldn’t go above 2%”
RBNZ Chief Economist Paul Conway: “Recent economic data suggest that monetary policy is working… but we still have a way to go” to get inflation to the 2% target
China’s Conference Board Leading Economic Index fell by 0.3% m/m in December after a 0.5% m/m decline in November
Japan’s unemployment rate dipped from 2.5% to 2.4% in December; the Jobs-to-applicant ratio slipped from 1.28 to 1.27
BRC: U.K.’s shop price inflation slowed from 4.3% y/y to 2.9% y/y in January, the lowest since May 2022, as retailers offered heavy discounts
Australia’s retail sales fell by 2.7% in December after a 1.6% uptick in November as Black Friday bargains brought spending forward; Annual sales up by 0.8% (the slowest since August 2021)
France’s consumer spending for December: 0.3% m/m (0.0% forecast, 0.6% previous)
France narrowly avoids technical recession with a 0.0% Q4 GDP (vs 0.0% expected, -0.1% previous)
Switzerland’s trade surplus shrank from 3.83B CHF to 1.25B CHF in December as imports (-3.8% m/m) fell faster than exports (-1.2% m/m)
Swiss KOF economic barometer rose for a third consecutive month in January, up to 101.5 from 98.0 in December
Price Action News
Overlay of CHF vs. Major Currencies Chart by TradingView
The British pound gave CHF bears a run for their moolah, but the Swiss franc is the biggest loser among the majors today.
The safe haven didn’t gain bearish momentum until the start of the European session. One possible reason for the weakness is optimism following the positive session from U.S. equities. France also narrowly avoided a technical recession, and there are no reports (yet!) of escalating tensions in the Middle East.
CHF is trading the weakest against USD, CAD, and NZD but is actually slightly positive against AUD and GBP.
Upcoming Potential Catalysts on the Economic Calendar:
Italy’s preliminary GDP at 9:00 am GMT
Germany’s preliminary GDP at 9:00 am GMT
U.K.’s mortgage approvals and individual lending at 9:30 am GMT
Eurozone’s flash GDP at 10:00 am GMT
U.S. CB consumer confidence at 3:00 pm GMT
U.S. JOLTS job openings at 3:00 pm GMT
German Bundesbank President Nagel to give a speech at 3:30 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! ️
AUD/USD: 15-min
AUD/USD 15-min Forex Chart by TradingView
The Australian dollar took advantage of weaker U.S. bond yields dragging USD demand lower earlier today. Australia’s weaker-than-expected December retail sales data soon caught up to the buyers, though, and AUD/USD edged lower.
It also didn’t help that USD demand improved and that some AUD/USD traders took profits from their AUD positions ahead of Australia’s quarterly CPI release.
Let’s see if AUD/USD can reclaim its intraweek gains in the next trading sessions.
As you can see, AUD/USD’s downswing is taking a breather around the .6600 Pivot Point and psychological level that’s also near a trend line support and the 200 SMA in the 15-minute time frame.Our Australia’s CPI Report Event Guide suggests that AUD’s reaction to the release may set the tone for AUD demand for the rest of the day.
If we see hotter-than-expected Q4 2023 inflation, then a bounce from the trend line and even an upside breakout above the range resistance may be on the table.
Of course, the degree of AUD/USD’s reaction may depend on overall risk sentiment. Growth and/or geopolitical concerns, for example, may limit AUD’s gains in case of a sticky high inflation release.
Alternatively, if Australia’s Q4 2023 consumer prices cool much faster than the markets are pricing in, then AUD/USD could draw in enough bears to extend its downswing.
A sustained break below the mid-range area that we’re eyeing may attract enough sellers to drag AUD/USD back to its .6570 range support.
What do you think? Which way will AUD/USD go?
