AUD/USD looks vulnerable near 0.6600 as US labor market solidifies further, China CPI eyed

AUD/USD is struggling to recapture the immediate resistance of 0.6600 amid the risk-off mood.
A decline in China’s CPI might force the PBoC to infuse more liquidity into the economy.
Solid US Employment data confirms that fears of stubborn inflation among Fed policymakers were real.

Sagar Dua FXStreet

The AUD/USD pair is displaying a back-and-forth action below the round-level resistance of 0.6600 in the Asian session. The Aussie asset looks vulnerable around the same as deepening fears of a recession in the United States amid expectations of higher rates by the Federal Reserve (Fed) have solidified the risk-aversion theme.

S&P500 futures are showing nominal losses after a weak recovery move. It seems that the dead cat bounce move by the 500-US stocks basket is fading away. The US Dollar Index (DXY) has turned sideways above 105.20 after a mild correction, however, the upside looks favored amid upbeat United States Employment data.

The solid addition of fresh payrolls in the US labor market in February due to rising demand has confirmed that fears of stubborn inflation among Fed policymakers were real. The US Automatic Data Processing (ADP) has reported an addition of 242K jobs in February, higher than the expectations of 200K and the former release of 119K. Therefore, Fed chair Jerome Powell cited “Fed is prepared to announce more rates to bring down inflation.”

Investors will get more clarity on the US labor market after the release of the US Nonfarm Payrolls (NFP) data, which will release on Friday. Apart from that, the release of the Unemployment Rate and the Average Hourly Earnings data will be of utmost importance.

After the fifth consecutive 25 basis points (bps) rate hike by the Reserve Bank of Australia (RBA) and a consideration of a policy-tightening pause led by a one-time blip in the monthly Consumer Price Index (CPI) by RBA Governor Philip Lowe, the Australian Dollar has faced immense heat.

Now, investors are shifting their focus toward China’s Consumer Price Index (CPI) (Feb) data. Annual China’s CPI is expected to decline to 1.9% from the prior release of 2.1%. On a monthly basis, China’s CPI has been trimmed to 0.2% from the former release of 0.8%. Lower inflation might force China’s administration and the people’s Bank of China (PBoC) to infuse more liquidity into the economy.

AUD/USD

Overview
Today last price	0.6592
Today Daily Change	-0.0002
Today Daily Change %	-0.03
Today daily open	0.6594

Trends
Daily SMA20	0.6811
Daily SMA50	0.6893
Daily SMA100	0.676
Daily SMA200	0.6784

Levels
Previous Daily High	0.6629
Previous Daily Low	0.6568
Previous Weekly High	0.6784
Previous Weekly Low	0.6695
Previous Monthly High	0.7158
Previous Monthly Low	0.6698
Daily Fibonacci 38.2%	0.6606
Daily Fibonacci 61.8%	0.6591
Daily Pivot Point S1	0.6565
Daily Pivot Point S2	0.6536
Daily Pivot Point S3	0.6504
Daily Pivot Point R1	0.6626
Daily Pivot Point R2	0.6658
Daily Pivot Point R3	0.6687

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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