- AUD/USD staged a goodish rebound from multi-month lows following the release of the NFP report.
- An unexpected uptick in the unemployment rate disappointing investors and weighed on the USD.
- The ongoing decline in the US bond yields further undermined the USD and remained supportive.
The AUD/USD pair refreshed daily tops during the early North American session, with bulls now awaiting some follow-through strength beyond the key 0.7500 psychological mark.
The pair witnessed a dramatic intraday turnaround from near seven-month lows and rallied over 50 pips amid some US dollar profit-taking following the release of a mixed US monthly jobs report. The headline NFP print surpassed even the most optimistic estimates and showed that the economy added 850K new jobs in June.
Adding to this, the previous month's reading was also revised higher to 583K from 559K reported earlier. Despite a welcome sign that the chronic labor shortages may finally be ending, an unexpected rise in the unemployment rate to 5.9% from 5.8% in May seemed to have prompted investors to lighten their USD bullish bets.
Meanwhile, an uptick in the jobless rate seemed to have disappointed the fixed income traders. This was evident from a sharp fall in the US Treasury bond yields, which further undermined the greenback. Apart from this, the risk-on mood further benefitted the perceived riskier aussie and triggered a short-covering move around the AUD/USD pair.
With the latest leg up, the major, for now, has snapped four consecutive days of the losing streak and trimmed a part of its weekly losses. Nevertheless, the AUD/USD pair remains on track to end the week in the red and still seems vulnerable to prolong its recent downtrend. Hence, any subsequent move up might be seen as a selling opportunity.
Technical levels to watch
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