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Aussie Dollar arrives at resistance

CMC Markets

Although today’s headline GDP figure was close to expectations, it was good enough to encourage currency traders. The Aussie jumped 25 pips against the US Dollar to around .9080 soon after the figure was released and has continued to work higher since. AUDUSD is currently testing the technical resistance provided by both its 50 day moving average and the 61.8% Fibonacci retracement of the last downtrend at around 91cents. While the average expectation for 2nd quarter GDP growth was around 0.5 to 0.6% there was wide range of views leading into this morning’s release. Some analysts were concerned the figure may have been considerably lower and this has led to some relief buying of the Aussie. Today’s result while not conclusive, makes it a little less likely that the RBA will cut rates further and this is supportive for the currency. Traders are also alert to the possibility that this figure may also be revised upwards at the next release. Both the US dollar and gold have been firm in Asian trading today as markets await further news on the potential for a US strike against Syria. With the US dollar firm, reaction to the GDP figure has seen the Aussie has risen against cross currencies. The decline in the Euro against the Aussie today has seen it complete a classic double top chart pattern.