FXStreet (Mumbai) – The risk-sentiment appears to improve amid a solid rebound in the Asian equities, which offered some support to the AUD bulls, now lifting AUD/USD back above the mid-point of 0.68 handle.
AUD/USD recovers from China GDP-led sell-off
Currently, the AUD/USD pair trades -0.10% lower at 0.6860, retreating from session lows struck at 0.6839 post-China data. The Aussie experienced wild swings on the release of the Chinese growth numbers and finally dropped sharply to session lows near 0.6840, before finding fresh bids at the last and now sees a minor pullback towards hourly 10-SMA placed at 0.6866.
Markets sold-off the Aussie into the ongoing China weakness, reinforced by weaker than expected Chinese macro releases, including the Q4 GDP print. In Q4 2015, China’s economy fell to 6.8%, down from the 6.9% registered in the previous quarter and against 6.9% growth expected. While industrial production and retail sales figures from China came in slightly weaker than expectations.
However, the recovery is seen gaining momentum over the last hours, on the back of improving market sentiment as the Asian indices resume the recovery mode after previous losses. The Nikkei is seen paring losses and trades -0.44%, while the Shanghai Composite jumps +1.64% and the Shenzhen’s CSI300 index rallies +1.37%.
In absence of relevant economic data for pair today, attention now turns towards Australian consumer sentiment as well as the US CPI data due tomorrow.
AUD/USD Levels to watch
The pair heads higher and finds the immediate resistance at 0.6930/35 (1h 100-SMA/10-DMA) above which gains could be extended to the next hurdle located at 0.6970/79 (1h 200-SMA/ daily R2). On the flip side, the immediate support located at 0.6839/24 (daily low/ Jan 15 low). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.6800 (Seven-year low).
(Market News Provided by FXstreet)