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Aussie jobs preview - what to expect in AUD/USD

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 14, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Guatemala) - AUD/USD has fallen back into a bearish trend again on the short-term sticks after a brief look in at the 100 sma on the hourly sticks post the Chinese trade data and neutral Yuan fix yesterday and slightly better risk sentiment in the market.

    Overnight, however, the dollar was champ and markets were cautious not to recover too far, the stocks were choppy and oil fell again. This now makes for an interesting session ahead with plenty to play for and AUD/USD in a neutral position before the Aussie jobs data.

    Aussie jobs outlook

    The jobs market has been a plus for the RBA that prefer waiting to see how the economy can bear up in this environment and the upward revisions to Oct from 2.7% to 3.5% and Nov at 3.5% personify the resilience in the jobs sector. Australian employment reports were major events in 2015, and today's December report also has the potential to surprise.

    "The market range is a near-record wide at –45k to +15k and we are at the top at +15k," explained analysts at TD Securities who added, "Even with a ‘surprise' +15k, an unchanged participation rate of 65.3% lifts the unemployment rate from 5.8% to 5.9%. After initial trading noise around a “strong” outcome, we expect the markets to resettle and fade outsized moves."

    The RBA next meet next month and the outcome of this report will be a strong consideration within the meeting, given the recent market volatility. However, the analysts at TD Securities pointed out, "Even if employment falls, the RBA next month can repeat this observation from the Dec RBA Board statement: “While GDP growth has been somewhat below longer-term averages .. business surveys suggest a gradual improvement in conditions in non-mining sectors ... accompanied by stronger growth in employment and a steady rate of unemployment.”"

    Key levels to monitor in AUD/USD

    AUD/USD's downside momentum had gathered pace overnight and continues to print lower lows in early Asia. The hourly cluster of ma's on the hourly chart is a pivotal point with the bias set either side of 0.6984. On a poor jobs data outcome, the 2016 lows are likely to be blown away at 0.6926 ahead of 0.6907, Sep 2015 lows and lowest levels since April 2009. Below there, S3 is located at 0.6862.
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