Australian retail sales have ticked higher last month, in what was a nice turnaround after last months contraction. However, the number missed analyst forecasts.

Australia Retail Sales for May: +0.1% m/m (expected 0.2%)

The AUD/USD hasn’t had a big response to the release, thanks largely to the fact that it rallied strongly yesterday. At the same time, there should be plenty of buying interest at 0.7000 at the moment. If anything price is ticking marginally higher.

Clearly the major news this week has been the RBA rate cut decision, which saw the OCR drop to 1.0%. The second straight cut, which now puts interest rates at record low levels.

Despite the cut, the Aussie rallied overnight, thanks largely to the fact that the move by the RBA had been clearly preempted the move. That took the AUD back above the important 0.7000 level.

For the time being, we should have to think that the move is very much priced in and we will have to wait for the next major data point which in my opinion will be Australian jobs.

The RBA has tied their monetary policy moves to the unemployment rate, so there will be plenty of attention on whether or not that rate can drop from where it sits at 5.2%.

The obvious level above to watch today will be 0.7050. There is a bit of a level at 0.7030, but it looks like price is pushing through that point for the time being. I would think the sellers will be strong at 0.7050 given that there are many thinking we have another rate cut coming in 2019, although for now, Governor Lowe says he will wait it out.