AUD/USD Weakens Following Moderate Employment Data

The Aussie has weakened from weekly highs and its psychological .92 level after Australia’s Employment Change figure printed below analyst expectations. This couples with the pullback in Housing Loans data earlier this week and reveals the RBA’s rate hikes are having their desired impact. Hence, there’s a possibility the central bank could stand pat at its next meeting. However, China’s Industrial Production did print below analyst expectations while pricing data was relatively tame despite the cautionary headlines. As a result, China may not be as aggressive in tightening as some analysts anticipated, meaning Australia could continue to enjoy healthy demand from Asia for its commodities. Meanwhile, attention will focus in on the West with the U.S. releasing key retail sales and consumer sentiment data tomorrow. Strong U.S. consumption data could favor the risk trade and help the Aussie move higher. The Aussie did peak above our 2nd tier downtrend line, which runs through 1/18 highs, or the .9275 level. Therefore, the Aussie could have a bit more topside mobility left in the tank. The Aussie also has an apparently strong support structure for the time being considering its climb this month has been somewhat gradual.

Technically speaking, the Aussie has multiple uptrend lines serving as technical cushions along with intraday, 3/9lows, and the psychological .90 area. As for the topside, the Aussie has multiple downtrend lines serving as technical barriers along with the psychological .92 area. Additionally, previous 2010 highs could serve as a hefty technical barrier should they be tested.

Price: .9135

Resistances: .9143, .9160, .9171, .9194, .9213, .9227

Supports: .9120, .9104, .9090, .9073, .9052

Psychological: .92, 2010 highs

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