AUD/USD goes into consolidation after rising toward 0.7400
- AUD/USD lost its traction after rising toward 0.7400 on Wednesday.
- Australian economy grew at a stronger pace than expected in Q3.
- US Dollar Index rebounds toward 91.50 ahead of mid-tier data.
The AUD/USD pair built on Tuesday’s gains and rose to a daily high of 0.7393 during the Asian trading hours. However, with the cautious market mood allowing the USD to start gathering strength against its rivals, the pair turned south and was last seen trading with small gains at 0.7373.
AUD fails to capitalize on upbeat GDP data
The data published by the Australian Bureau of Statistics showed on Wednesday that the real Gross Domestic Product (GDP) in the third quarter expanded by 3.3% on a quarterly basis. This reading followed the 7.7% contraction recorded in the second quarter and beat the market expectation of 2.6%. Nevertheless, the positive impact of this report on the AUD remained short-lived.
On the other hand, Wall Street’s record-setting rally on Tuesday caused the greenback to suffer heavy losses against its risk-sensitive rivals. The US Dollar Index (DXY) slumped to its lowest level since April 2018 at 91.10 but staged a technical correction during the European trading hours.
Ahead of the ADP Employment Change and the ISM NY Business Conditions Index data from the US, the DXY is up 0.1% on the day at 91.41.
In the meantime, the S&P 500 Futures are posting modest losses, suggesting that AUD/USD could find it hard to gather bullish momentum in the second half of the day if risk flows struggle to retake the control of financial markets.
Technical levels to watch for