July month employment statistics from the Australian Bureau of Statistics, up for publishing at 01:30 GMT on Thursday, will be the immediate catalyst for the AUD/USD pair traders.

Market consensus suggests that the headline Unemployment Rate may remain unchanged at 3.5% on a seasonally adjusted basis whereas Employment Change could ease to 25K from 88.4K. Further, the Participation Rate may remain intact at 66.8%.

Considering the Reserve Bank of Australia’s (RBA) recently cautious comments, coupled with the trouble in China and softer-than-expected Wage Price Index at home, today’s Aussie jobs report become crucial as the AUD/USD breaks monthly bullish chart formation.

Ahead of the event, analysts at Westpac said,

Given the solid demand for labor as evinced by job vacancies and consumer/business surveys, Westpac anticipates employment to lift at an around trend pace of 50k in June (market f/c: 25k). With only a small increase in participation, the unemployment rate should tick downwards from 3.5% to 3.4%. 

How could the data affect AUD/USD?

AUD/USD bears lick their wounds at one week long support line, taking rounds to 0.6930 by the press time, as traders seek fresh clues amid the market’s indecision after the Fed Minutes and the recent Aussie Wage Price Index for the second quarter (Q2).

That said, hopes of an upbeat Aussie jobs report could propel the AUD/USD are fewer amid the broad pessimism surrounding economic slowdown and 75 bps Fed rate hike in September. However, strong prints of the Employment Change and softer Unemployment Rate won’t go unnoticed and hence can provide a kneejerk upside to the quote.

Considering this, FXStreet’s Valeria Bednarik says

A solid Australian employment report would be cheered by market players but also have limited positive effects on the Aussie, particularly if the market sentiment remains on the back foot.  A dismal report, on the other hand, should exacerbate the dominant trend and push the AUD further down across the FX board.

Technically, a clear downside break of the one-month-old bullish channel directs AUD/USD prices towards the yearly low of 0.6678. However, 50-DMA and May’s low, respectively around 0.6900 and 0.6825, could act as buffers to the south. Meanwhile, recovery remains elusive until the quote stays below the 200-DMA level around 0.7120.

Key Notes

AUD/USD approaches 0.6900 with bears in control ahead of Australia Employment data

Australian Employment Preview: No surprises on solid job creation

About the Employment Change

The Employment Change released by the Australian Bureau of Statistics is a measure of the change in the number of employed people in Australia. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).

About the Unemployment Rate

The Unemployment Rate released by the Australian Bureau of Statistics is the number of unemployed workers divided by the total civilian labor force. If the rate hikes, indicates a lack of expansion within the Australian labor market. As a result, a rise leads to weaken the Australian economy. A decrease of the figure is seen as positive (or bullish) for the AUD, while an increase is seen as negative (or bearish).

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD drops back below 0.9700 as yields rebound ahead of US GDP, German inflation

EUR/USD drops back below 0.9700 as yields rebound ahead of US GDP, German inflation

EUR/USD sellers are up and roaring as sour sentiment joins firmer yields to renew the downside during early Thursday, after a day full of surprises and positive performance. Germany’s HICP may not impress pair buyers unless US GDP disappoints.

EUR/USD News

GBP/USD turns sideways around 1.0800, focus shifts to US/UK GDP data

GBP/USD turns sideways around 1.0800, focus shifts to US/UK GDP data

GBP/USD is expected to resume its upside journey after concluding its correction to near 1.0800. To revive UK’s financial stability, the BOE announced a bond-buying program worth GBP 65 billion. Does BOE really not have the stomach to fight inflation while simultaneously keeping financial stability?

GBP/USD News

Gold sees cushion around $1,650 after a corrective move, US GDP buzz

Gold sees cushion around $1,650 after a corrective move, US GDP buzz

Gold price is experiencing a healthy correction in the Tokyo session after witnessing a bumper rally. The precious metal is expected to find significant bids around the immediate cushion of $1,650.00 as the downside bias is not backed by momentum. 

Gold News

XRP: A checklist for the next rally

XRP: A checklist for the next rally

XRP price has shown incredible buying pressure after a dip into the $0.381 to $0.433 demand zone. A recovery above $0.464 could ignite the next run-up, but ideally, a retest of $0.397 could be a good place to be a bull.

Read more

A week after Japanese yen intervention

A week after Japanese yen intervention

Last Thursday was an incredibly volatile trading session for the USD/JPY. This volatility was largely caused by the Bank of Japan's (BoJ) intervention in the currency markets to defend its depreciating currency, the Japanese Yen. Last week’s move was the first time since 1998 that the BoJ had intervened.

Read more

Forex MAJORS

Cryptocurrencies

Signatures