– Australia Employment to Mark First Rise Since June
– AUDUSD Bullish Trend Remains Intact; Key Resistance Ahead
Trading the News: Australia Employment Change
The bullish trend in the AUDUSD may continue to gather pace over the next 24-hours of trading as the Australian economy is expected to add 15.0K jobs in September.
What’s Expected:
Time of release: 10/10/2013 0:30 GMT, 20:30 EDT
Primary Pair Impact: AUDUSD
Expected: 15.0K
Previous: -10.8K
DailyFX Forecast: -10.0K to 15.0K
Why Is This Event Important:
Indeed, a rebound in job growth may encourage the Reserve Bank of Australia (RBA) to carry its wait-and-see approach into 2014, but the employment report has failed to meet market expectations over the last two prints (July & August) amid the ongoing slack in the $1T economy.
Expectations: Bullish Argument/Scenario
Release
Expected
Actual
ANZ Job Advertisements (MoM) (SEP)
—
0.2%
NAB Business Confidence (SEP)
—
12
Retail Sales (MoM) (AUG)
0.3%
0.4%
The ongoing improvement in business confidence along with the pickup in private sector consumption may prompt a more meaningful rebound in employment, and a positive print is likely to prop up the aussie as market participants scale back bets for additional RBA rate cuts.
Risk: Bearish Argument/Scenario
Release
Expected
Actual
Building Approvals (MoM) (AUG)
-0.5%
-4.7%
Trade Balance (AUG)
-400M
-815M
Company Operating Profits (QoQ) (2Q)
0.9%
-0.8%
However, the slowdown in global trade paired with the persistent slack in the real economy may continue to generate a weaker-than-expected labor report, and a dismal development may threaten the bullish trend in the AUDUSD as it renews bets for lower borrowing costs.
How To Trade This Event Risk(Video)
Bullish AUD Trade: Employment Rebounds 15.0K or Greater
Need green, five-minute candle following the print to consider a long Australian dollar trade
If market reaction favors a long trade, buy AUDUSD with two separate position
Set stop at the near-by swing low/reasonable distance from entry; look for at least 1:1 risk-to-reward
Move stop to entry on remaining position once initial target is hit, set reasonable limit
Bearish AUD Trade: Job Growth Weakens for Third Month
Need red, five-minute candle to favor a short AUDUSD trade
Implement same setup as the bullish Australian dollar trade, just in opposite direction
Potential Price Targets For The Release
AUDUSD Daily
Chart – Created Using FXCM Marketscope 2.0
Upward Trending Channel Continues to Take Shape
Relative Strength Index Holds Above Support (53)
Interim Resistance: 0.9500 (38.2% retracement) to 0.9520 (1.618% expansion)
Interim Support: 0.9270 (100.0% expansion) to 0.9290 Pivot
Impact that the change in Australia Employment has had on AUD during the last month
Period
Data Released
Estimate
Actual
Pips Change
(1 Hour post event )
Pips Change
(End of Day post event)
AUG 2013
09/12/2013 1:30 GMT
10.0K
-10.8K
-65
-60
August 2013 Australia Employment Change
Australia lost another 10.8K jobs in August, with the unemployment rate advancing to 5.8% from 5.7% the month prior, and the ongoing weakness in the labor market may prompt the RBA to further embark on its easing cycle to further insulate the $1T economy. Indeed, the Australian dollar took a spill following the weaker-than-expected print, with the AUDUSD slipping below the 0.9300 handle, and the higher-yielding currency struggled to hold its ground throughout the day as the pair closed at 0.9269.
— Written by David Song, Currency Analyst
To contact David, e-mail dsong@dailyfx.com
Follow me on Twitter at @DavidJSong
To be added to David’s e-mail distribution list, please follow this link
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Source: Daily fx
