Australia Employment data (Aug) that was released at 9:30 pm EDT showed total employment figures -8.85K vs expectation of +5K. AUD/USD dropped immediately on the news but rebounded quickly as traders noticed that Unemployment rate dropped to 5.1% amidst expectations of 5.3%. Nonetheless, this is no reason to be cheerful as declined in participation rate from 65.2% to 65% contributed significantly to this change. Taking a look deeper, we will find that Part Time Employment dropped by -9.3K while Full Time Employment is stable at +0.6K. This development does not change anything fundamentally. Essentially, Australia economy is relatively the same as Jul from an employment perspective, and hence the rally following the news release become all the more peculiar.
Regardless of the knee-jerk reaction, from a technical perspective, we can see the initial decline also did not manage to break below the Channel bottom. Prices has tried once on the back of worse than expected Aussie GDP data, and also tried/failed a 2nd time during European trading yesterday. Currently AUD/USD is trading between H3 and H4 levels, which is also generally non-directional indicative. Similar to yesterday, this new price action does not make AUD/USD outright bullish as we are still trading below 1.023 (yesterday’s high/confluence with Monday support level)
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