Australian Dollar climbs near two-month highs as NFP turns negative

The AUD/USD pair surged to its highest in nearly two months past 0.7070 earlier on Friday, following the release of the United States (US) Nonfarm Payrolls (NFP) report. The move owes nothing to Australia. Instead, the US Dollar (USD) came under broad and heavy selling pressure once the payrolls report landed, with the Australian Dollar (AUD) emerging as the biggest beneficiary on a board where every major currency gained against the Greenback.

Payrolls fell by 23K in July against expectations of an 80K increase, the first outright contraction since February, and June was revised down to 20K from the 57K originally reported.

The reaction across the complex tells the rest. The US Dollar Index (DXY) is posting losses , Gold ripped to seven-week highs, and Silver put in solid gains, while USD/JPY unwound the whole of Thursday's advance and slid back beneath the 157.00 handle.

Richmond Fed President Thomas Barkin said the figures were consistent with a sector in weak balance, characterizing the labor market as more low hire, low fire. He conceded the data "doesn't feel very good but it's where it is," while noting that corporate earnings are strong and growing nicely, and that he is watching them for linkages to the job market.

On another note, Iran's parliament speaker and top negotiator, Mohammad Bagher Ghalibaf, accused US President Donald Trump of staging "theater diplomacy" in a post on X on Thursday, as Washington and Tehran offered conflicting accounts of their engagement. Under the draft plan for managing the waterway, reported by Fars, US and Israeli ships would be barred from the Strait of Hormuz, with restrictions extending to countries Tehran says have caused it damage until compensation is paid.

Short-term technical analysis:

On the 4-hour chart, AUD/USD trades at 0.7060, maintaining a bullish near-term bias as it holds above both the 20-period Simple Moving Average (SMA) at 0.7043 and the 100-period SMA at 0.7003. The pair is advancing toward the nearby horizontal barrier at 0.7064, while the Relative Strength Index (RSI) around 63 suggests firm but not overextended upside momentum.

On the topside, immediate resistance is seen at 0.7064, followed by a higher horizontal cap at 0.7078. On the downside, initial support emerges at 0.7049, reinforced by the 20-period SMA at 0.7043, with a deeper floor at 0.7035 and the 100-period SMA providing broader trend support near 0.7003.

(The technical analysis of this story was written with the help of an AI tool. Know more.)