Australian Employment Change, which is released monthly, provides a snapshot of the health of the Australian labor market. A reading which is higher than the market forecast is bullish for the Australian dollar.
Here are the details and 5 possible outcomes for AUD/USD.
Published on Thursday at 00:30 GMT.
Indicator Background
Job creation is one of the most important leading indicators of overall economic activity. Thus, the release of Employment Change is a market-mover which can affect the movement of AUD/USD.
Employment Change posted a strong gain of 17.4 thousand in the August release, crushing the estimate of 5.2 thousand. The indicator has been on an impressive roll, easily beating the forecast for the past four months. Another gain is expected in the September reading, with an estimate of 7.2 thousand.
Sentiment and Levels
The Aussie posted strong gains last week, but these were in large part due to the disappointing Fed minutes. The US economy is outperforming that of Australia and monetary divergence favors the US dollar. So, the overall sentiment is neutral on AUD/USD towards this release.
Technical levels from top to bottom: 0.7664, 0.7440, 0.7284, 0.7213, 0.7160 and 0.71.
5 Scenarios
- Within expectations: 4.0K to 10.0K: In this scenario, AUD/USD could show some slight fluctuation, but it is likely to remain within range, without breaking any levels.
- Above expectations: 10.1K to 14.0K: A strong reading could push the pair above one resistance level.
- Well above expectations: Above 14.0K: A sharp rise in employment numbers could propel AUD/USD upwards, and two or more resistance lines could be broken.
- Below expectations: 0.0K to 3.9K: A lower than expected reading could pull the pair downwards, with one support level at risk.
- Well below expectations: Below 0.0K: A reading in negative territory will likely hurt confidence in the Australian economy and AUD/USD could break below two or more support levels.
For more on the Aussie, see the AUD/USD forecast.
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