US Retail Sales Up Next

The main data focus for today’s US session will be US retail sales for April. The market is looking for retail activity to have slowed last month. Forecasts call for headline retail sales to improve to 1% from 0.5% prior, while the core reading is expected to have fallen back to .4% from 1%.

In light of the cost-of-living crisis currently gripping the US, a slowdown in retail activity seems reasonable to expect. With this in mind, there is room for some undershooting on the headline estimate. If we do see both readings marking a slowdown from the prior month, this would no doubt put the focus back on recessionary fears in the US. In this scenario, the current USD move might gain more traction, casting some uncertainty on the Fed’s recent hawkishness. On the other hand, should retail sales come in stronger than expected, this would likely see equities fall back and USD rally, keeping the focus on projected Fed rate hikes.

Where to Trade US Retail Sales?

AUDUSD

A hawkish set of RBA minutes overnight, as well as better risk appetite, is helping lift AUD today. Consequently, AUDUSD looks best places to benefit from any USD weakness resulting rom today’s data. Price is now trading back above the prior 2022 lows around .6989. While above here, the focus is on a breakout above the local bear channel towards .7188 next, in line with MACD and RSI which are both close to turning bullish.