Australian Dollar, AUD / USD, Jobs Report, COVID-19, RBA TALK POINTS:
- Australia’s unemployment rate improved despite the spread of the Covid Delta variant
- The Australian dollar’s reaction was flat as it struggled to keep the rally going
- Saab AUD / USD remain flexible as long as the RBA is likely to remain adaptive?
The Australian dollar found some support immediately after the release of better-than-expected employment data. Australia’s unemployment rate was 4.6% and 4.9% before, with markets expecting to rise to 5%. However, AUD /USD then it could not follow as the strength of the USD continued to dominate the markets.
Today’s unemployment figure is based on soft economic data from Australia, recent building permits and retail printouts. Although the headline CPI is above the target range, the RBA’s preferred measure of inflation, truncated average, is printed on the low side. It probably gives central bank time to maintain an open policy, given the uncertainty about the extent of the Delta option.
The RBA noted in the minutes of its last meeting that employment will remain in the September quarter in the light of the Delta option. The July data do not include the full impact of the closures.
Previously, ASX 200 The index opened weaker after the second day of decline in US equities. It’s like fading iron ore and copper prices also exerted additional negative pressure related to goods AUD. After the data, the currency pair tried to get out of the low levels recently lowered a year ago. However, this does not seem to have continued, maintaining the dominant downward trend.
AUD / USD TECHNICAL ANALYSIS – AUDI TRADING OR TERMINATION?
AUD / USD is testing trend line support and is experiencing a negative momentum. The 100-day moving average recently exceeded the 200-day mark, also known as the “death cross”. This is seen as a historically strong signal of a long-term rate of decline. The 200-day moving average is currently flat, but the downturn is likely to turn its gradient south. The short-term momentum of the 21-day moving average (representing the active trading days of a typical month) has been down for some time, but is beginning to slow down.
AUD / USD DAILY TABLE
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– Written by Dan McCarthy, strategist, for APAC DailyFX
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