An excellent indicator of how the market will react to those statistics is the Australian Dollar. Following a several-week losing trend in tandem with a broader decline in risk assets, AUD/USD experienced a little comeback last week.
A surge of Covid-19 outbreaks that resulted in lockdowns throughout major Chinese commercial centers in April pulled down the industrial profits, which increased by 3.5 % on an annual basis. While specific Covid measures remain to be implemented in areas like Beijing and Shanghai, the problem has recently stabilized. However, the statistics from this morning should show a strengthening resurgence, which should assist to restore some hope in the APAC area. If the y/y number is higher than that of the previous month, the AUD/USD may increase.
The April Coincident and Leading Economic Index results will decline in Japan after their final corrections. Last week, the Japanese Yen declined against the US Dollar, but sellers seem to have pulled back, as the USD/JPY pair gained 0.16% merely. However, prior to losing strength, the currency pair reached its highest point since September 1998. Although the technical position has recently deteriorated, USD bulls may still try to launch a strike.
Aluminum and copper, along with other industrial metals may offer hints as to how traders perceive the near-term macroeconomic picture. The price of copper the other week reached its lowest level since February 2021. Recently, the demand for steel has decreased. Demand for industrial metals has been severely impacted by resurgent concerns about an impending economic downturn in the wake of the Fed’s most recent interest rate hike. Sentiment in the metals market may increase if China’s industrial profits data is published in a robust print.
Prices were supported by a trendline from 2021 throughout last week’s trading. The 23.6% Fibonacci retracement mark and the declining 20-day Simple Moving Average (SMA) could act as barriers to further gains. Intersections over their corresponding midpoints on the MACD and RSI indicators (which are both strengthening) could give the Australian Dollar technical support in the following days.