- AUD/USD accepted the offer to refresh the intraday low and continued to be under pressure near the weekly bottom.
- Australian employment change was -40.9K and unemployment fell to 3.4% in July.
- Sentiment remains divided amid softening yields and mixed stocks.
- Headlines around China, Taiwan earlier joined the slightly dovish Fed minutes Test shorts.
AUD/USD took a hit during Thursday’s Asian session Another burden of gloomy employment data, don’t forget the fresh concerns surrounding Taiwan. Nonetheless, at press time, AUD/USD remains under pressure around 0.6935 after refreshing daily lows to 0.6924.
Australia’s headline employment change fell to -40.9K vs. 25K expected vs. 88.4K previously, while unemployment was up from expected and prior 3.5% to 3.4%. Additionally, the participation rate fell to 66.4% from the 66.8% market forecast and previous reading.
ALSO READ: BREAKING: AUD/USD under pressure as Australia’s jobs data is generally subdued
It is worth noting that the Australian wage price index in the second quarter (Q2) fell in the previous trading day, and the price of AUD/USD was under pressure. Still, the data showed a sequential growth of 0.7% in the second quarter, the fastest growth since September 2014. However, these figures remain dismal compared to inflation figures, which in turn justify the Reserve Bank of Australia’s (RBA) recent cautious comments.
In addition to the Australian jobs data, there are mixed concerns around China. The Australian jobs data and the mixed concerns around China are also positive for AUD/USD seller.
Earlier in the day, the China Securities Journal mentioned that “as part of the investment push, China may issue an additional 1.5 trillion yuan.”
Instead, the latest comments from the Office of the US Trade Representative that “early this fall, the United States and Taiwan will begin formal negotiations on a trade initiative,” appear to have reignited a battle over the U.S.-China sentiment ‘s concerns.
A senior US diplomat in charge of East Asia affairs, Kritten Brinker, said: “The United States is committed to maintaining peace and stability in the Taiwan Strait. .” It is important to note that the Fed minutes discussed dollar bulls the day before. As Reuters said, officials were prepared to Fortunately, the pace of interest rate hikes has been slowed down under the signal of slowing inflation. However, stronger US retail sales in July appeared to put downward pressure on AUD/USD prices. Amid these events, U.S. 10-year U.S. Treasury yields are up from a weekly high of 2.90% at press time It retreated, down 1 basis point (bp) to 2.89%. Also, S&P 500 futures edged lower after reversing from a four-month high the previous day.
US weekly prints August jobless claims and Philadelphia Fed manufacturing survey may keep AUD/USD traders feel happy. On top of that, recession fears and Fed worries are crucial to watch for new impulses.
technical analysis
The strongest bearish MACD signal since late June joins a clear downside breakout of a month-old bullish channel, leaving AUD/USD bears on track to revisit the yearly low of 0.6678. However, the 50-DMA and May lows, around 0.6900 and 0.6825 respectively, could act as a buffer to the south. Meanwhile, a recovery remains elusive until quotes remain below the 200-day SMA around 0.7120. That said, the support line of the said channel appears to have immediate resistance near 0.6990.
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