AUD/USD bulls approach 0.7000 on upbeat China GDP

• AUD/USD takes the bids to refresh intraday high on strong data from Australia’s biggest customer.
• China Q4 GDP improved to 2.9%, Industrial Production and Retail Sales also mark better-than-forecast figures for December.
• Risk profile remains unclear even as full markets return, yields dwindle but stock futures print mild losses.
• Recently mixed US data, cautious mood ahead of Aussie jobs report, US Retail Sales probe AUD/USD traders.

AUD/USD renews its intraday high around 0.6980 as firmer statistics from China joins the US Dollar retreat during early Tuesday. The Aussie pair buyers, however, remain cautious ahead of this week’s US Retail Sales and Australian employment data amid mixed sentiment.

That said, China's Gross Domestic Product (GDP) for the fourth quarter (Q4) printed 0.0% QoQ figure versus -0.8% expected and 3.9% prior. Further details suggest that the Industrial Production for December grew 1.3% YoY versus 0.5% market forecasts and 2.2% prior readings. Additionally, Retail Sales improved to -1.8% YoY for December compared to -7.8% consensus and -5.9% prior. Earlier in the day, Australia Westpac Consumer Confidence for January rose to 5.0% from 3.0% prior.

Also read: Breaking: China’s Q4 GDP expands 2.9% YoY vs. 1.8% expected

It should be noted that the return of full markets restores bearish bias for the US Dollar, after portraying a corrective bounce the previous day, as the US Treasury yields fade the week-start rebound. Even so, the market’s risk appetite remains unclear as the S&P 500 Futures print mild losses as it retreats from the monthly high.

Having seen the initial market reaction of the China dump, AUD/USD traders may pay attention to the aforementioned risk catalysts and the second-tier US data like NY Empire State Manufacturing Index for January expected -4.5 versus -11.2 prior. However, major attention will be given to Wednesday’s US Retail Sales for December, expected 0.1% YoY versus -0.6% prior, as well as Australian employment data for the said month.

Considering the recently positive Aussie numbers, in contrast to the mixed US data, the AUD/USD pair is likely to witness further upside unless the scheduled key statistics disappoint the bulls.

Technical analysis

The AUD/USD pair’s U-turn from a two-month-old ascending resistance line, close to 0.7025 at the latest, joins nearly overbought conditions of the RSI (14) to tease the Aussie pair sellers. It’s worth noting, however, that, a daily closing below the 200-DMA, around 0.6825 by the press time, becomes necessary for the Aussie bears to retake control.