Building approvals will also be reported
In the new trading day, Australia will be releasing retail sales for February. Last month the sales came in worse than expected at 0.1% vs. expectations of 0.4% gain. The number for December was also not so great at -0.5% (see report from last month HERE).
This month the expectation is for a gain of 0.3%. The release will be at 9:30 PM ET/0130 GMT.
What are the technical's telling us?
Looking at the 4-hour chart, the price action on Monday and Tuesday has respected support below and resistance above in narrow trading range.
The pair's lows reached 0.7649 on Monday. That was just above the low from last week at 0.76425. Buyers leaned against the old low and the price moved higher.
On the move up, the high today at 0.7706, stalled right below a downward trend line, the swing high from March 30 at 0.7707 and the swing low from March 1 at 0.7712. The 0.7707-12 area represents a key resistance area on the topside now.
The range from 0.7649 to 0.7706 of 57 pips is fairly narrow. As a result, a weaker or stronger retail sales report should see a move outside the range (and outside the support and resistance levels). We currently trade a little more toward the upper extreme at 0.7684.
Looking at the daily chart below, the 50% of the move up from the December 2016 low comes in at 0.76472 (see chart below). That increases the importance of the low support from the hourly.
SUMMARY: The retail sales is expected to show a modest rebound from the 0.1% gain last month. The expectation is for a 0.3% gain. A better number will have traders looking for a break above the 0.7707-12 level. That would potentially signal the low is in place.
On something less, and the trend in spending remains sluggish and could see a retest of the lows and the lower trend line ultimately.
With the price trading between the level, and a narrow two-day trading range, surprises on the data should lead to an extension of the range in the direction of the move. Be aware.
