AUD/USD – Will election shocker shake up the Aussie?

AUD/USD continues to lose ground this week. Currently, the pair is trading at 0.6877, down 0.2% on the day. On the release front, the U.S. releases UoM consumer confidence, with an estimate of 97.8 points.

Australian employment numbers were mixed on Wednesday. The economy created 28.4 thousand jobs in April, marking a 3-month high and crushing the estimate of 15.2 thousand. However, the unemployment rate climbed to 5.2%, higher than the estimate of 5.0%. This is the highest level since August. Meanwhile, wage growth has remained fairly steady. Wage price index remained pegged at 0.5% for a second straight quarter. The key indicator has posted gains of 0.5% or 0.6% since the last quarter of 2016.

The Australian general election was a shocker, as Prime Minister Scott Morrison’s conservatives had been widely expected to lose to the center-left Liberals. Morrison had trailed badly in the polls throughout the campaign, but came from behind in stunning fashion to pull off the victory. The markets reacted favorably to the election results, and AUD/USD climbed as high as 1.0% on Monday. The pair is coming off a dismal week, falling 1.9%. This marked its sharpest decline since early February.

Markets steady after a weak week

Fluid situations

AUD/USD Fundamentals

Friday (May 17)

  • 10:00 US Preliminary UoM Consumer Sentiment. Estimate 97.8
  • 10:00 US Preliminary UoM Inflation Expectations
  • 10:00 US CB Leading Index. Estimate 0.2%
  • 13:40 US FOMC Member Clarida Speaks

*All release times are DST

* Key events are in bold

AUD/USD for Friday, May 17, 2019

AUD/USD for May 17 at 9:55 DST

Open: 0.6892 High: 0.6897 Low: 0.6865 Close: 0.6877

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.67686 0.6744 0.6825 0.6968 0.7085 0.7190

AUD/USD was flat for much of the Asian session and showed limited movement in the European session. AUD/USD has posted small losses in the North American session.

  • 0.6825 is providing support
  • 0.6968 is the next resistance line
  • Current range: 0.6825 to 0.6968

Further levels in both directions:

  • Below: 0.6825, 0.6744 and 0.6686
  • Above: 0.6968, 0.7085, 0.7190 and 0.7240

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.