AUD volatility should increase after retail sales numbers
I still see the short term risk as being to the downside for the AUD. AUD/NZD broke below 1.2500 this morning and we are seeing a lot of long liquidation there. AUD/JPY again failed at the big technical resistance level at 88.00 and has turned sharply lower and even GBP/AUD has made a slight recovery back towards the top of its multi-week trading range. The retail sales numbers due out in 30 minutes will probably increase volatility and I’m hoping for an intraday spike towards the .9130 breakdown level. Even if there is a strong retail sales figure I do not think it will have any significant influence on RBA thinking (barring something exceptional). The forecast is for a 0.8% MoM increase. The big macro stops are supposedly situated below .8950 and the 200-day MA and I thinking we might see a test of this level before the weekend.

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Reuters just commented that Oz retail sales a +1.2% afterwards they said it was a test only , bit odd
totally agree with with you there Sean….. Aud is a defo sell on rallies …..
Talking about Retail Sales, Shanghai came out with great ones, along with stronger home sales fwiw http://www.shanghaidaily.com/sp/article/2010/201005/20100506/article_436129.htm