AUDUSD: Aussie bleeds after dismal data
|The Australian dollar was down 1% on Tuesday and the AUDUSD pair dropped to one-month lows as it was trading at around 0.6780 during the US session.
Earlier in the day, the Australian employment change dropped sharply to -19,000 in October, down from 12,500 in September, thus the Australian economy lost jobs. The unemployment rate also worsened to 5.3%. The Aussie was sold-off sharply after these bad numbers.
Moreover, China’s economy slowed further in October, with factory output, retail sales and investment all below estimates. It was the weakest retail sales growth since 2003 and the weakest Fixed-Asset Investment growth since 1998. Miserable Chinese data also undermined the Australian dollar.
Additionally, the Wall Street Journal reported on Wednesday that talks had snagged on farm purchases, which is negative news for the markets as well.
Technically speaking, the Aussie is now testing previous swing highs at 0.6770, which is a strong support for the pair. However, if the price drops below it, further decline toward the 0.67 handle could occur.
On the upside, the short-term resistance could be near 0.9810 and as long as the pair remains below this resistance, the outlook seems bearish.
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