AUD/USD: popped and dropped ahead and retail sales miss

AUD/USD has popped and dropped around the retail sales data that came in as a miss ahead of today's RBA meeting at 03.30GMT. Currently, AUD/USD is trading at 0.7777, up 0.15% on the day, having posted a daily high at 0.7786 and low at 0.7761. 

Australia January Retail Sales arrived at +0.1% m/m (vs. expected +0.4% m/m). Meanwhile, overnight, AUD/USD was pressured by lower commodities and dropped to 0.7726 before rebounding to 0.7760 and ending the NA shift flat.

• Australia January retail sales rebound is weaker than expected
• Australia current account deficit widened to AUD $14 billion in fourth quarter

RBA, GDP and nonfarm payrolls in focus

The focus will now turn to RBA later today where the bank is expected to remain on hold at 1.5%. Traders will look to the statement for a catalyst instead. Then, traders will shift attention to Q4 GDP where growth is expected to moderate to 0.5% q-o-q due to headwinds from dwelling investment and weak export volumes which were held back by temporary disruptions to coal exports, as explained by analysts at Nomura, "We see some downside risks to this forecast".

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AUD/USD level

AUD/USD is up to test the 200-D SMA here but is finding it a tough level to penetrate held up by this data release ahead of the RBA today and nonfarm payrolls on Friday. Above the 200-D SMA, initial resistance is last week’s high at 0.7892. To the downside, 0.7637 as the 78.6% retracement and the 0.7588 2016-2018 uptrend are in focus.