AUD/USD refreshes three-week top above 0.7700 on upbeat Aussie employment figures

• AUD/USD picks up bids after strong Australian jobs report for March.
• Australia Employment Change grew past-35K forecast, Unemployment Rate dropped below market consensus and prior.
• Economic recovery hopes ignore vaccine jitters, second-tier geopolitical risks to keep S&P 500 Futures up.
• US dollar weakness adds to the upside momentum, US Retail Sales eyed.

AUD/USD ticks up to refresh the highest since March 23 while flashing 0.7745 as a quote during early Thursday. While the broad US dollar weakness and market optimism seem to have favored the aussie pair’s initial run-up, the recently strong employment data for Australia helped the quote refresh multi-day high.

Australia’s headlines Employment Change rose beyond 35K forecast to 70.7K, versus 88.7K prior, whereas Unemployment Rate eases below 5.8% previous readouts and 5.7% market consensus to 5.6%.

Read:  Aussie March Employment +70.7k vs Reuters poll +35.0k

Other than the jobs report, market sentiment and the US dollar weakness could also be cited as the key catalysts behind the AUD/USD run-up.

Given the strong vaccination drive in the developed economies, coupled with the unlock measures, traders stay optimistic over the faster economic recovery even as Johnson & Johnson recently spoiled the mood. Also on the risk-positive side could be the global central bankers’ fraternity that keeps defying the reflation risks and stand together in support of easy money policy. Additionally, US President Joe Biden’s $2.25 trillion infrastructure spending and Aussie PM Scott Morisson’s rejection of vaccine woes offer extra strength to the risk-on mood.

Alternatively, the US sanctions on Russia and Saudi Arabia’s interception of Houthi missiles and drones should have negatively affected the mood but failed amid a quiet session in Asia.

Amid these plays, S&P 500 Futures print 0.20% intraday gains but stocks in Australia are mildly offered as the US 10-year Treasury yields halt the previous downside. Though, the US dollar index (DXY) refreshes a three-week low and favors the AUD/USD bulls.

Considering the market optimism and weaker US dollar, not to forget the recent Aussie employment data, AUD/USD traders may remain positive ahead of the US Retail Sales figures for March, expected to reverse prior -3.5% with +6.3% YoY figures.

Read:  US March Retail Sales Preview: Can a strong rebound ramp up inflation expectations?

Technical analysis

A daily closing beyond a downward sloping trend line from February 25, coupled with a clear breakout of 50-day SMA, respectively around 0.7640 and 0.7720, directs AUD/USD further north towards the 0.7800 threshold. However, March high near 0.7850 can test the bulls afterward.