AUDUSD Up on Positive Labor Data. Can It Rally to 0.6900?
AUDUSD finished yesterday’s trading flat as market participants waited for today’s employment report. It opened at 0.6849 and traded sideways throughout the day. By the end of the New York session, it had settled at 0.6850.
Today, however, AUDUSD is enjoying some bids following the positive labor data from Australia. The currency pair is up over 20 pips from its opening price, trading at 0.6874.
November Labor Figures Top Forecasts
Analysts had expected the economy to have generated 14,500 jobs in November. However, today’s data topped forecasts when it came in at 39,900. The unemployment rate also trickled lower at 5.2%. It was expected to match October’s reading at 5.3%.
Is Australia’s Labor Market All Well and Good?
However, it would seem that a closer look at the employment data shows some bleak spots in the labor market. For one, only 4,200 full-time jobs were created during the month. The rest of the headline figure were part-time work. We also saw a downward revision to October’s report. It was initially reported that 19,000 jobs were lost during the month. It turned out that there were 24,800.
If you remember, the RBA made it clear that they would not hesitate to cut rates if economic conditions don’t improve. It would seem that today’s report is not enough to change the minds of market participants that a rate cut will happen early next year.
The 4-hour chart of AUDUSD reveals that the currency pair found enough bids around 0.6850 and bounced off support at the rising trend line (from connecting the lows of November 29 and December 11). If there are enough buyers in the coming trading days, it may soon retest last week’s highs at 0.6937.
However, if you are still feeling bearish on the currency pair, you can look at the areas between 0.6860 to 0.6900. This covers the 23.6% to 61.8% Fib levels when you draw the Fibonacci retracement tool from the high of December 13 to yesterday’s low. Reversal candles in this area could suggest that sellers are getting ready to bring AUDUSD down to its December lows at 0.6800.