PPI higher. Retail sales not as good as expected
The PPI data was higher than expected with YoY moving to 2.1% from 1.5% in the 2Q. That was the highest level since June 2014. Retail sales, however, was not so great coming in at 0.2% vs 0.3% MoM.
The AUDUSD moved higher and traded to a new session high (and traded at the highest level since October 2nd), taking out the high from yesterday at 0.72119. The price reached 0.72134, but has backed off to 0.7207 currently.
Looking at the daily chart, the price yesterday took out the topside trend line at 0.7196. The price also moved above the 0.7200 level. That level stalled the fall back in August. The price did trade above and below the level in September and October.
Today in quiet trading, the low reached 0.7096 which is just above the broken trend line. Stay above keeps the bulls/buyers in control with the 100 day MA at 0.7269 (blue line in the chart above) as a target down the road. The 38.2% is also in that area at 0.7272.
If the price moves below the broken trend line, there should be more downside potential.
Looking at the hourly chart below, the 38.2% retracement of the move up from the low on Wednesday comes in at 0.71588. The swing high from October 17 is also near that level.
A break below the 0.7196 will look toward that corrective level. Buyers ahead of that will be eyed with a break below, muddying the water for the bulls a bit.