AUD/USD jumps 30 pips after Aussie employment data beat forecasts

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  • AUD/USD turns positive to regain 0.7300 after surprisingly positive Aussie jobs report.
  • Australia’s August month Employment Change rose 111K, Unemployment Rate dropped to 6.8%.
  • Market sentiment turns sober as Asian traders fear a brake on easy money.
  • US President Donald Trump’s vaccine hopes failed to please the buyers, busy day to watch ahead.

AUD/USD takes the bids near 0.7305 to reverse the early-Asian losses after Australia’s August month employment data flashed welcome numbers on Thursday. In doing so, the Aussie pair defies the downbeat performance of equities during the post-Fed action.

Surprise, surprise, surprise!

While markets anticipated Victoria’s lockdown to weigh on the headline employment data, Australia’s Unemployment Rate dropped below 7.7% forecast and 7.5% prior to 6.8% in August. Additionally, the Employment Change also crossed -50K expected with +111K figures. The data can help the RBA to keep its recent cautious optimism and was well received by the Aussie buyers.

Read: Aussie jobs data beats all round sends AUD/USD 0.3% higher

Having initially cheered US President Trump’s vaccine hopes, global trade sentiment sours amid hopes of stagnant monetary policies and no more rate cuts. With the Fed’s dot-plot indirectly suggesting the American monetary policymakers’ reluctance to act immediately, global markets fear the rest of the central banks, immediately followed by the BOJ and BOE, will also hit the stops on any more easy money.

Also acting as a trade negative measure is American leader Trump’s dislike for the World Trade Organization (WTO) as well as US House Speaker Nancy Pelosi’s hardstand for the stimulus package that results in the policy deadlocks.

Amid all these plays, S&P 500 Futures and Japan’s Nikkei 225 both mark around 0.30% losses while Australia’s ASX 200 and New Zealand’s NZX 50 are down 0.60% by the press time.

Having witnessed the market’s reaction to Aussie data, traders may look forward to the Bank of Japan’s (BOJ) monetary policy meeting for immediate direction ahead of the long day comprising BOE and US Jobless Claims. It should, however, be noted that the risk catalysts can keep the driver’s seat and may offer magnified moves moving on.

Technical analysis

The pair’s sustained trading beyond the 21-day EMA, at 0.7263 now, directs the bulls towards the August 31 high of 0.7416 with the 0.7400 threshold acting as an intermediate halt. Additionally, an ascending trend line from July 14, currently around 0.7225, also acts as strong downside support.

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