AUD/USD holds below the 100-day moving average
The aussie remains among the weakest performers in trading today, although trading ranges for most major ranges continue to stay subdued as traders await the payrolls data to come later in US trading. AUD/USD continues to sit near the lows for the day around 0.7220 as price remains below the 100-day MA (red line) @ 0.7237.
That will be the key line in the sand for AUD/USD as we close out the week. The recent rhetoric for the aussie hasn’t been too good especially after the Q3 GDP report disappointed earlier in the week. That prompted questions about the RBA’s ability to hike rates next year and there’s even chatter of possible rate cuts now if things continue down this path.
From a technical perspective, the upside move appears to have stalled just below the 200-day MA (blue line) with the 21 August high @ 0.7382 helping to limit gains. Right now, the focus will be all about the payrolls data later but the key item on the agenda to watch out for will be wages.
With expectations of a Fed rate hike this month being scaled back, markets will look towards wages data to either solidify the notion that the Fed will or won’t hike on 19 December. We all know that payrolls are solid and the unemployment rate will still show that the labour market is tight, so the focus will be on wages instead.
In the event of any beat on the data, watch out for the 0.7200 handle in AUD/USD. That remains the key downside level that is holding off further declines on the daily chart and a break below that will open up further room to the downside. Should the 0.7200 level give way, the 13 November low @ 0.7164 will be eyed and if that fails to hold it could be a quick trip back towards the year’s lows again for the pair.
As for any upside breaks, watch out for the 100-day MA in the near-term before the 0.7250-60 level comes into focus. There is about AUD 6.5 billion worth of expiries at those levels so they could act as a magnet for price action later on in the day.