FxWirePro: AUD/USD struggles to extend gains despite upbeat Australian Retail Sales, US Dollar bounce caps upside

Chart - Courtesy Trading View 

AUD/USD was trading 0.04% lower on the day at 0.6735 at around 04:00 GMT, fails to extend previous session's momentum.

Upbeat Australian Retail Sales data fails to impress Aussie bulls, US dollar strength and risk-off cap gains in the pair.

Data released by the Australian Bureau of Statistics earlier on Tuesday showed Australian retail sales rebounded in January after a surprise plunge in the previous month.

Australia Retail Sales rose to 1.9% in January, higher than the consensus of 1.5%, after contracting by 3.9% in December.

Upbeat retail demand data is going to add to the current troubles for the Reserve Bank of Australia (RBA) policymakers who are trying to soften inflationary pressures.

Australian gross domestic product (GDP) and monthly consumer price index (CPI) data are due on Wednesday, which will drive further price action. 

Australia's economy is expected to grow by a solid 0.7% in Q4 2022 and at 2.7% on an annualized basis. Inflation is expected to soften slightly to 7.9% in January, from 8.4% the previous month. 

US data on Monday showed core capital goods orders accelerated in January, beating forecasts, while contracts to buy previously owned U.S. homes rose the most in more than 2-1/2 years in January.

US dollar index was holding 0.16% higher on the day at 104.79 at around 04:30 GMT, weighing on the commodity currencies. 

Major Support Levels: 

S1: 0.6690 (Lower BB)

S2: 0.6663 (50% Fib)

Major Resistance Levels: 

R1: 0.6760 (5-DMA)

R2: 0.6795 (200-DMA)

Summary: Technical bias for the pair is bearish. Price action is consolidating break below daily cloud. Momentum is with the bears. Test of 50% Fib at 0.6663 likely.