AUD/USD drops further towards 0.7700 on mixed China data dump

AUD/USD paid a little heed to China’s top-tier data releases on early Friday as the aussie pair refreshes intraday low around 0.7720, down 0.33% on a  |  16/04/2021 03:12
  • AUD/USD fails to keep the corrective pullback from the day’s low.
  • China Q1 GDP, Industrial Production came in weaker-than-expected but Retail Sales crosses forecast and prior.
  • Market sentiment dwindles over geopolitical risks, consolidation after the previous day’s upbeat performance.

AUD/USD paid a little heed to China’s top-tier data releases on early Friday as the aussie pair refreshes intraday low around 0.7720, down 0.33% on a day. The reason could be traced from the mixed data and challenges to the risk-on mood.

China’s Q1 GDP eases below 1.5% forecast and 2.6% prior to 0.6% YoY whereas the Industrial Production weakened to 14.1% versus 17.2% expected and 35.1% previous readouts in March. However, Retail Sales improved from 28.0% market consensus and 33.8% previous to 34.2% during the previous month.

Read: China’s GDP sees a record expansion of 18.3% YoY in Q4 2020 vs 18.9% expected, AUD/USD unfazed

Not only the mixed data from the key customer but downbeat sentiment also weigh on the AUD/USD prices by the press time.

Among the main problems, US President Joe Biden’s defense to the American sanctions on Russia over political interference and hacking gain major attention. Additionally, today’s talks between the leaders of the US and Japan in Washington, over China, 5G and other relief programs, also weigh on the sentiment as the West gathers support to battle the dragon nation.

It should also be noted that Bloomberg’s news suggesting an extended ban over the use of Johnson & Johnson’s covid vaccine by the US Centers for Disease Control and Prevention (CDC) exert additional downside pressure on the market sentiment. Even if the same can cause limited damage to the US and the UK economy, Reuters' poll suggests the delay in the vaccinations as the biggest risk to the Eurozone economy.

On the positive side, no new covid cases from Australia’s Queensland, Victoria and New South Wales (NSW) join hopes of faster economic recovery in America and Britain, backed by faster vaccinations, to back the optimists.

Against this backdrop, S&P 500 Futures print mild losses after refreshing the record top the previous day whereas the US 10-year Treasury yield differs from Thursday’s heavy slump to the one-month low by the press time.

Read: S&P 500 Futures step back from record top as US Treasury yields pare weekly loss

Having witnessed the initial market reaction to the Chinese data, AUD/USD traders will rely on the risk catalysts for fresh impulse ahead of the US consumer sentiment figures. Considering the shift in the market’s mood, coupled with mixed data from China, the aussie pair may remain depressed.

Technical analysis

A downside break of 50-day SMA around 0.7720 should recall the sub-0.7700 area on the chart. Until then, AUD/USD bulls can keep attacking the 0.7760-65 resistance area before targeting the 0.7800 threshold, needless to mention the previous month’s peak surrounding 0.7850.

 

Share

Popular News

Show More Popular News

TheFXApp's Views

TheFXApp analyses will provide both fundamental and technical comprehensions on finance
and other asset classes for TheFXApp viewers

Back

Login to TheFXApp Account

Your TheFXApp account gives you access to the tools that we offer our customers including our
Technical Studies & Sentiment for your accounts.

Forgot Password?

Don't you have a TheFXApp account? With a few easy steps you can easily register to TheFXApp

Create a TheFXApp's Account

Your TheFXApp account gives you access to the tools that we offer our customers including our Technical Studies & Sentiment for your accounts.

register_ty

Thank you!

Welcome to TheFXApp family!

You have succesfully completed the registration.
We will send you an e-mail to give you some
instructions and our Terms and Conditions!
Our account representatives will be contacting you as
soon as possible. If you have any further questions
please do not hesitate to mail us via info@thefxapp.com