Chinese Q4 GDP Headline figure rises 7.9% vs consensus of 7.8%. Real GDP (Q/Q) rose 2.0% vs 2.2% estimated, which is put in an even worst light when one notice that the previous quarter’s data has been revised downwards to 2.1%.
Other data released together with the GDP include Retail Sales which showed gain of 15.2% Y/Y and Industrial Production which grew 10.3% Y/Y. All considered, China’s economy does not seem half bad, and AUD/USD rallied initially on the better than expected headline figure.
15 Minutes Chart
Price moved up but was unable to hold above 1.055. Beyond this, bulls would be worried that the better than expected news barely push price higher than the previous swing high around 6 hours ago. Furthermore, that was the opportunity for Bulls to give a strong showing following a Stochastic reading rebound. If price was able to hold above the 1.055 resistance, bullish momentum could have accelerated towards 1.057/1.058. As it is, price action appears to act as a confirmation that the bears are in charge now.
Hourly Chart suggest the same bias, with importance of 1.055 clearly seen for the past few days. Beyond 1.055, 1.054 and subsequently 1.053 acts as support against pushes back to 1.05. Stochastic readings appears to be heading lower, continuing the downward cycle.
Bottomline: Chinese Official Data has always been treated with a pinch of salt due to overly “optimism” in Chinese reporting. It appears that the market is not digesting the news well despite the slightly better than expected headline figure.
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