“¢ Impressive Aussie jobs report helped the pair to catch some aggressive bids.
“¢ Subdued USD price action/positive commodity prices remained supportive.
“¢ Traders now eye US economic releases for some fresh bullish impetus.
The AUD/USD pair built on the strong Aussie jobs data-led positive momentum and touched one-week tops, around the 0.7280-85 region in the last hour.
After yesterday’s good two-way price action, the pair caught some fresh bids on Thursday and continued scaling higher for the third consecutive session. Indications that China and the US may be taking steps to de-escalate their bitter trade dispute turned out to be one of the key factors benefitting China-proxy Australian Dollar.
The pair got an additional boost from today’s impressive release of the Aussie jobs report, which showed that employment surged in October and the unemployment rate held steady at 5% as compared to an uptick to 5.1% expected. This coupled with a positive tone around commodity space, especially copper, further underpinned the commodity-linked Australian Dollar.
Meanwhile, a subdued US Dollar price action, especially after the Fed Chair Jerome Powell’s cautious comments, remained supportive of the strong bid tone surrounding the major. Speaking at an event hosted by the Federal Reserve Bank of Dallas, Powell said that the US economy is strong but could face headwinds from global economic slowdown though sounded committed to the Fed’s gradual interest-rate-hike path.
The pair, for now, seems to have found acceptance above 100-day SMA, and a follow-through up-move beyond the 0.7300 handle will confirm a near-term bullish breakout. Market participants now look forward to the US economic docket – highlighting the release of monthly retail sales data, along with the initial weekly unemployment claims and regional manufacturing indices, for some fresh bullish impetus.
Technical levels to watch
On a sustained move beyond the 0.7300 mark, a fresh bout of short-covering is likely to accelerate the up-move towards 0.7380-85 heavy supply zone with some intermediate resistance near mid-0.7300s. On the flip side, 100-DMA, around the 0.7255 region, now seems to protect the immediate downside, which if broken might turn the pair vulnerable to head back towards testing the 0.7210-0.7200 support zone.
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