Australian jobs preview and where to next for the AUDUSD
Tony Sycamore October 13, 2021 3:49 PM
Tomorrow at 11.30 am Sydney time, Australian labour force data for September is due to drop.
The forecast is for another significant fall in employment of around -120k driven by lockdowns and mobility restrictions. The participation rate is expected to drop from 65.2% to 64.8% and moderate the rise in the unemployment rate from 4.5% to 4.8%.
The risks for all measures are for weaker readings, if only as some payback for ten straight months of falls in the unemployment rate, to its lowest level since 2008.
That said, it is likely that the market looks through weak numbers tomorrow in anticipation of a rebound into yearend supported by leading labour market indicators.
As noted in an interview yesterday on Money FM 89.3, here the market is repricing currency pairs based on whether they are a net energy importer or exporter.
Reflecting this, the currency pairs of energy exporters have done well, including the CAD, NOK, and AUD. In contrast, the currencies of energy importers, including the EUR, JPY, CHF, and JPY, have seen a red mark placed against their names.
Based on the energy thematic running through the currency space, an expectation of a strong rebound in employment in coming months, and the fact that the market remains heavily short of the AUDUSD, we think the downside in the AUDUSD is limited.
Turning to the charts, the AUDUSD currently sits at .7340, just above a band of support .7320/00 area. Providing the AUDUSD continues to hold above this support and trades now lower than .7280/75, the view remains that a short-covering rally towards .7500c has commenced.
Source Tradingview. The figures stated areas of October 13th, 2021. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.