Australian Dollar Rises on Positive December Jobs Number

Global stocks dropped as traders continued to worry about the spreading of Coronavirus in China. The disease has killed 17 people and has infected over 500 more. In the latest development, officials in Huanggang closed off the city by shutting down the inbound and outbound transportation. The same happened in the neighboring city of Ezhou and Wuhan. The market is afraid that the current shutdown will have an impact on the Chinese economy. The disease has also spread to South Korea, Japan, Thailand, and the United States. In China, the Shanghai composite index declined by 84 points. In Japan, the Nikkei dropped by 235 points. The same happened in Europe where the DAX and FTSE 100 dropped by 42 and 20 points respectively.

The Australian dollar rose in reaction to positive employment numbers from the country. At the same time, Australian stocks declined in reaction to the disease that is spreading in China. On employment, the country added more than 28.9k jobs in December. This was higher than the consensus estimates of 15.0k. The unemployment rate dropped to 5.1%, which was the lowest level since April last year. In addition, the monthly hours worked increased by 0.2% in December and by 1.7% throughout the year. Meanwhile, the underemployment rate remained at 8.3%. In Japan, the Japanese yen declined after the country released weak trade numbers. Exports declined by -6.3% while imports declined by -4.9%.

The euro was little changed against the USD as the markets waited for the Christine Lagarde press conference. In the conference, the ECB president is expected to talk about her plans for the current year. The press conference will come a few minutes after the ECB delivered its interest rates decision. As was widely expected, the central bank left interest rates unchanged. The deposit facility rate was left unchanged at -0.50% while the marginal lending facility was left at 0.25%. 

XBR/USD

The XBR/USD pair declined to an intraday low of 61.30, which was the lowest level since December 3. The price is along the lower line of the Bollinger Bands and below all the short and medium-term moving averages. The RSI, which has been dropping, reached the oversold level of 30. The signal and main line of the Stochastic Oscillator also dropped to the oversold level. The pair may continue moving lower to test the support of 60.00.

AUD/USD

The AUD/USD pair rose to an intraday high of 0.6878 from a low of 0.6837. The price is along the 38.2% Fibonacci Retracement level. The 14-day and 28-day exponential moving averages have made a bullish crossover. The pair appears to have found a resistance at the level shown in red below. This means that the pair may remain at the current level ahead of the Australian CPI data expected next week.

EUR/USD

The EUR/USD pair was relatively unchanged at 1.1090 ahead of the ECB press conference. The pair has been trading in a narrow range of 1.1100 and 1.1070. The pair has also formed a small symmetrical triangle pattern. This means that the pair may see a significant breakout in either direction ahead of the ECB press conference.