Following a short-lived climb up to the 0.7180 area in the Asian session, the AUDUSD pair lost its traction and moved into the negative territory as the greenback started to outperform its rivals. As of writing, the pair was losing 0.3% on a daily basis at 0.7147.
January 21, GKFX – Earlier today, the data from China showed that industrial production expanded by 5.7% on a yearly basis in 2018 to beat the market expectation of 5.3%.
However, other data confirmed the economic slowdown with the quarterly GDP growth ticking down to 1.5% on a quarterly basis. On the same note, the IMF has announced that it cut the 2019 world growth outlook to its lowest level since 2015 at 3.5%.
US Dollar Index starts the week on a positive note
On the other hand, with major European currencies struggling to stage a meaningful recovery, the dollar stays strong on the day to further weigh on the pair. Despite a lack of significant macroeconomic data releases from the U.S. on Monday, the US Dollar Index, which tracks the greenback against a basket of six major currencies, pushed higher after closing the previous week in the positive territory and touched its highest level in more than two weeks at 96.42.
With American markets staying closed due to the Marthin Luther King Jr. Day on Monday, the trading action is likely to be subdued in the second half of the day.
AUDUSD technical analysis
The pair could face the immediate resistance at 0.7165 (50-DMA) ahead of 0.7200 (psychological level) and 0.7235 (Jan. 11 high). On the downside, supports align at 0.7130 (20-DMA), 0.7085 (Dec. 19 low) and 0.7035 (Dec. 21 low).
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