Australian Dollar is trading as the strongest one as the week starts, on the back of some positive economic data.
Retail sales rose 0.4% mom in April versus expectation of 0.3% mom, and prior month’s 0.0%. The Australian Bureau of Statistics noted that cafes, restaurants and takeaways led the rise assisted by an unusually warm April. But there were likely negative impacts for some businesses in “clothing, footwear and personal accessories and department stores.” Company gross operating profits rose 5.9% qoq, 5.8% yoy seasonally adjusted in Q1. Wage growth was slow at 0.8% qoq seasonally adjusted and 5.1% yoy. TD securities inflation gauge, however, was flat 0.0% mom in May versus expectation of 0.3% mom and prior month’s 0.5% mom.
AUD/CAD is a pair to note as it’s showing consistent near-to-medium term upside momentum. From the action bias table, D row argues that’s AUD/CAD has just come out of a consolidation. This is also reflected in H and 6H action bias.
The above indication is consistent with the D action bias chart too.
Take a look at the regular OHLC chart, the break of 0.9873 indicates resumption of recent rebound from 0.9553. Strong support was seen slightly below 0.9578/91 medium term support zone. That is, the fall from 1.0241 should have completed too. Further rise should now be seen back to 61.8% retracement of 1.0241 to 0.9553 at 1.0066. A way to trade this move is by going long at the current level, with a stop below today’s low at 0.9780, and a target at 1.0066.