The AUDUSD currency pair experienced a surge driven by robust employment data, signalling a strong Australian economy. This may prompt the Reserve Bank of Australia to consider raising interest rates next month, despite forgoing a rate hike this month due to economic concerns. Contributing to the surge is the weakening of the Greenback as the Federal Reserve approaches the end of its monetary tightening.
The unemployment rate in Australia remained steady at 3.5%, defying predictions of a slight increase, with employment data exceeding expectations at 32.6K job additions, surpassing the forecasted 15K. However, the trajectory for the currency pair could be affected by the upcoming release of US Initial Jobless Claims.
Technical
The AUDUSD currency pair is consolidating between the 0.65981 major support and the 0.68942 major resistance as demand and supply factors fight for dominance. A slight pullback saw the currency pair succumb to downside pressure and establish support at the 50% level, intersecting with the 50-day moving average.
However, a slight surge encouraged a breakthrough at the 23.60% Fibonacci level, which may pave the way towards the 0.68942 major resistance as the currency pair edges away from the 50-day moving average. If the 0.68942 major resistance fails to hold, the pair may be encouraged towards higher resistance levels if a volume breakdown is avoided.
On the other hand, the 23.60% Fibonacci level could hold as resistance which may encourage a pullback towards the 50% level and possibly earmark a downward trend towards the 0.65981 major support.
Summary
The AUDUSD currency pair’s downside seemed limited, as a boost from favourable employment data in Australia encouraged a breakthrough at the 23.60% Fibonacci level. If the upward momentum is sustained, the 0.68942 major resistance may be a point of interest towards further upside possibilities. However, the 23.60% Fibonacci level could hold due to the release of US Initial Jobless claims which could encourage a pullback towards the 0.65981 major support.
Sources: TradingView, Reuters
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