AUD/USD: Trading the Australian jobs Mar 2015

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 was unexpectedly weak in January, coming in at -12.2 thousand. This was much lower than the estimate of -4.7 thousand. The markets are expecting a strong turnaround in the February release, with an estimate of +15.3 thousand.

Sentiment and Levels

Although the Aussie avoided another RBA rate cut last week, the currency remains under pressure and has moved closer to the US 75 cents level.  The week hasn’t started well on the Australian release front, as NAB Business Confidence slipped to zero points. So, the overall sentiment is bearish on AUD/USD towards this release.

Technical levels from top to bottom: 0.7904, 0.7799, 0.7692, 0.7601, 0.7403 and 0.7283.

5 Scenarios

1. Within expectations: 12.0K to 18.0K: In this scenario, AUD/USD could show some slight fluctuation, but it is likely to remain within range, without breaking any levels.
2. Above expectations: 18.1K to 22.0K: A strong reading could push the pair above one resistance level.
3. Well above expectations: Above 22.0K: A sharp rise in employment numbers could propel AUD/USD upwards, and two or more resistance lines could be broken.
4. Below expectations: 8.0K to 11.9K: A lower than expected reading could pull the pair downwards, with one support level at risk.
5. Well below expectations: Below 8.0K: A very poor reading would likely hurt confidence in the Australian economy  and  AUD/USD could break two or more support levels.

For more on the Aussie, see the AUD/USD forecast.

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