Australian fourth quarter (Q4) GDP report is due for release on Wednesday at 00:30 GMT and is expected to show an expansion of 2.5% QoQ.
The Australian growth numbers are likely to have a significant impact on the AUD/USD pair, although the prevalent risk mood and US dollar dynamics could also influence the major’s reaction to the GDP release, FXStreet’s Dhwani Mehta reports.
“Australia’s GDP rate is expected to expand by 2.5% QoQ in Q4 when compared to a 3.3% growth recorded in the three months to September. Meanwhile, the economy is seen contracting 1.8% in the reported period vs. -3.8% booked in the third quarter.”
“From a technical perspective, the four-hour chart shows that AUD/USD has confirmed a bear flag breakdown. Although the sellers await a sustained move below the critical horizontal 200-simple moving average (SMA) at 0.7738 to resume the downward spiral towards 0.7600.”
“Only if the Australian Q4 GDP figure beats estimates by a big margin, it could save the day for the AUD bulls. AUD/USD could stage a comeback towards the powerful resistance at 0.7800, where the 21 and 100-SMAs converge. Overall, the path of least resistance appears to the downside for the aussie.”