Baxia Markets
May 28, 2024

AUDUSD Gains After Weak Retail Sales Data, Gains Wiped Out Over European Trading

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During the Asian trading session, the AUDUSD pair experienced positive momentum despite the release of weaker-than-expected retail sales data, which came in at 0.1% versus the forecasted 0.3%. This unexpected market reaction drove the pair higher, surpassing yesterday's high. However, during the European trading session, the market saw a pullback from today's peak.

On the 1-hour time frame, the technical indicators present a nuanced picture. The Relative Strength Index (RSI) reached the overbought zone earlier today and has since made a pullback. The Moving Average Convergence Divergence (MACD) signal line and histogram are positioned above the zero line, indicating a bullish trend. However, the histogram crossing below the signal line suggests a pullback is underway, aligning with the RSI's movement after hitting the overbought zone.
AUDUSD Gains After Weak Retail Sales Data, Gains Wiped Out Over European Trading
A significant technical development is the appearance of a golden cross on the Exponential Moving Averages (EMA), with the EMA 50 crossing above the EMA 200, confirming a bullish reversal. Additionally, the Ichimoku indicators—Tenkan-sen, Kijun-sen, and Chikou Span—are all positioned above the cloud, reinforcing a strong bullish sentiment.

The key level of support to monitor is the lower boundary of the Ichimoku cloud. A break below this level could negate the bullish reversal signal and suggest a potential shift in market sentiment.

Overall, the AUDUSD remains technically bullish but is currently experiencing a pullback. Traders should pay close attention to the support near or above the Ichimoku cloud to gauge the sustainability of the bullish trend.

Key Economic Releases to Watch Today

AUD, Retail Sales 

Actual 0.1% vs Forecast 0.3% vs Previous -0.4%

USD, CB Consumer Confidence 

Forecast 96.0 vs Previous 97.0




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