While the AUD is most primarily based on general risk sentiment – where equities and commodities go,   we still want to keep our eye on the key fundamental releases, which will be coming out of Australia in the upcoming Asian trading session – including most important one retail sales.

A positive release in which retail sales are climb above 0.3% – say 0.5% or above  could create the conditions for the Aussie to push towards its highs from the last two weeks (other risk events notwithstanding).

A negative release – one that undershoot expectations and shows either flat or negative sales in January would increase concerns about the wider economy and the prospects for consumer spending to drive growth in the early part of the year. 

This would be a reason to increase pressure on the RBA to lower rates further and as a result would be a negative fundamental factor for the Australian dollar and on the face of it should weaken the Aussie from a fundamental interest-rate perspective.