Favour fading bounce in AUDUSD, 200dma key resistance – BNPP

Research Team at BNP Paribas, notes that Australia’s Q4 GDP data was better than expected, with the economy growing a solid 3.0% y/y versus expectations for a 2.5% print.

Key Quotes

“Rate market pricing for the RBA has responded in turn, delaying easing expectations to September/November from July/August previously, and the AUDUSD has firmed to a level uncomfortably close to the stop (0.7280) on our short trade recommendation. However, we expect strong resistance to come in at the 200dma (currently just below 0.7260) which has not been broken since September 2014.

Going forward, the next key release in Australia will be retail sales on Friday. We continue to see downside risks to AUDUSD, particularly in light of the signals from both our short- and medium-term valuation models and BNPP FX Positioning Analysis suggesting the market has fully unwound its short AUDUSD position. We target 0.6850 on our short recommendation.”

Research Team at BNP Paribas, notes that Australia’s Q4 GDP data was better than expected, with the economy growing a solid 3.0% y/y versus expectations for a 2.5% print.

(Market News Provided by FXstreet)