AUD/USD: 0.7170EUR/USD: 1.1140The FX markets were mostly rangebound on Wednesday, with the action lying elsewhere, particularly in the oil price and in equities, which both had good rallies after Iran lent its backing to the oil deal struck during the previous session between Russia and Saudi Arabia. The FOMC Minutes indicated that the Fed acknowledged the potential downside risks to the global economic outlook and would appear to put any rate hike on hold for now but which had little effect on the markets, and the outcome seems to have been more or less priced in. The Australian Unemployment data is due today, to be followed later on by the ECB Minutes and then the US Jobless Claims and the Philadelphia Fed Mfg Survey.
AUDUSD had a constructive session today as risk sentiment improve and tested the 0.7180 resistance, which currently lies close by.
Further gains look possible although this is going to depend largely on the outcome of the Australian unemployment figures, due later this morning. This data has been volatile but it has recently, generally seen an out-performance relative to expectations, with the January outcome expected to be 5.8%, +15K, and a PR of 65.2%. Also due will be the China CPI for January (+0.5% mm, 1.9%yy) and PPI (-5.4%yy).
A solid jobs figure would see the Aud take out the sellers at 0.7180 above which could then see a run back to 0.7200, beyond which would allow a move towards 0.7218 (minor,) 0.7241 (4 Feb high), and then towards 0.7280 and 0.7300.
A poor outcome in the jobs data would see the Aud head back towards the initial support, seen at 0.7140 (minor) ahead of a potential return to 0.7100. This seems unlikely – unless the employment figure surprises to the downside – but below 0.7100 would then allow a return to the session low at 0.7083 and below there, towards support at 0.7060/65 (minor). Below this would head towards 0.7040 and 0.7000, ahead of the Thursday low at 0.6983 and the Wednesday low at 0.6972 although this seems unlikely to be seen today.
Economic data highlights will include:
RBA Gov Edey Speech, Unemployment, China CPI, PPI.
Jim LanglandsFX Charts
