CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Australian Dollar in the Hot Seat

November 13, 2019 3:44 PM

Australian Dollar in the Hot Seat

In a few hours, Australia will release their employment data for October, with the Unemployment Rate expected to downtick from 5.3% in September to 5.2%.  However, the key figure will be the employment change, with expectations of an increase of 18,000 jobs in October vs an increase of 14,700 in September.  Australia does something nice for us;  they breakdown the headline number between full-time jobs and part-time jobs.  This distinction gives a clearer picture of how the overall job market is doing.  Expectations for October are for an increase of 34,000 full-time jobs and a decrease of 16,000 part-time jobs!  These expectations are both better than September’s numbers.  If these numbers come out as expected, full-time jobs will be increasing and part-time jobs will be decreasing MoM!  Australia could use some positive data, as the US-China trade deal headlines have mainly been the driver of the Australian Dollar.  Earlier today, “sources” said that US-China trade talks have hit a snag. 

AUD/USD has closed down the last 4 days (although the range has only been about 80 pips over that period).  Recent highs were near horizontal resistance at .6913. The pair spiked through that level 4 days in a row earlier this month, however could not close above the resistance.  Perhaps that was because of the downward sloping trendline just above at near .6935 and the 200-day moving average at .6942. Could the employment data be the catalyst to reverse that and help propel the pair to new highs? 

Source: Tradingview, City Index

On a 240-minute timeframe, AUD/USD is trying to hold the bottom trendline of rising channel near .6832.  This price coincides with the 38.2% Fibonacci retracement level from the lows on October 2nd to the highs on October 31st.  If price breaks lower, first support is horizontal support near .6810 down to .6800, which is the 50% retracement of the previously mentioned timeframe.  This is also a psychological support level, as it is a nice round number (which markets seem to pay attention to).  There is a falling wedge within the channel that has formed on the 240-minute chart.  If price breaks out to the top side, the target for the breakout of a falling wedge is a 100% retracement, which would be right at the horizontal resistance on the daily timeframe at .6913.  Above that, watch for the resistance levels mentioned on the daily timeframe.

Source: Tradingview, City Index

When the Australian Employment data is released, make sure to dig deeper into the headline data and look at the number of full-time jobs created vs the number of part-time jobs created.   The difference could be a reason the AUD/USD will go bid or sell off!


StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024