AUD/USD Bulls Eye 0.7100 as US Retail Sales Misses Expectations

The AUD/USD pair is eyeing a target of 0.7100 after the US Retail Sales data missed expectations, providing a bullish signal for the Australian dollar. From a market structure perspective, buyers have not yet regained the June 1 peak at 0.7190, but the first resistance level is indeed 0.7100, followed by the latter.

The Reserve Bank of Australia (RBA) sets interest rates, which significantly influence the AUD's value. The RBA aims to maintain a stable inflation rate of 2-3% and has used quantitative easing and tightening to adjust credit conditions. High interest rates compared to other major central banks support the AUD, while low interest rates have the opposite effect.

The health of China's economy is another significant factor for the AUD, as it is Australia's largest trading partner. When China's economy grows well, it purchases more raw materials and goods from Australia, boosting demand for the AUD. Conversely, a slowdown in Chinese growth can negatively impact the AUD's value.