With the FOMC minutes indicating that the commencement of tapering in late 2021 is now a real possibility, the US Dollar has gained broadly across the board, putting commodity dollars on the back foot. The AUD/USD is down 0.78% on the day, despite upbeat employment data.
Data released in the early hours of Thursday indicate that Australia’s unemployment rate dropped from 4.9% to 4.6%, exceeding market expectations of an increase to 5.0%. However, the Aussie economy added only 2,200 jobs, which despite being well above the expectation of a
contraction of 42,500 jobs did not match the previous 29,100 job additions.
This has left the Australian Dollar vulnerable to other woes from the COVID-19 delta variant, which has continued to rise locally. The FOMC minutes content showed several Fed policymakers angling to commence tapering early.
Technical Levels to Watch
The AUD/USD price is currently testing the 0.71471 support, which has so far held firm. A breakdown of this level allows 0.70657 to come into the picture. 0.70034 is a psychological price level below this area, and a breakdown of that level allows the price to dip to 13-month lows at 0.68302.
On the other hand, a bounce on 0.71471 allows for a reprieve towards 0.72182. A further advance beyond this barrier brings 0.73382 and 0.73724 into the mix as potential additional targets to the north.