The Australian Dollar (AUD) concluded its recent winning streak, facing pressure after the release of mixed Aussie employment data. Australia’s 10-year government bond yield also declined, reflecting a dovish sentiment surrounding the Reserve Bank of Australia (RBA) regarding monetary policy, further weighing on the AUD/USD pair.
Initially, the AUD received support from improved risk appetite following lower-than-expected US Consumer Price Index and Retail Sales data, which undermined the US Dollar (USD). This propelled the AUD/USD pair to a four-month high of 0.6714.
However, the Australian employment data revealed an increase in Employment Change but a rise in the Unemployment Rate to 4.1%, dampening market sentiment towards the AUD. Additionally, RBA Chief Economist Sarah Hunter addressed housing supply and demand imbalances, underscoring challenges posed by rising prices, rents, and homelessness in Australia.
Meanwhile, technical analysis indicates that the AUD/USD pair is trading around 0.6680, situated within an ascending triangle on the daily chart. The 14-day Relative Strength Index (RSI) suggests a bullish bias, remaining above the 50 level.
Looking ahead, the AUD/USD pair may encounter resistance near the upper boundary of the ascending triangle around 0.6714. A breakthrough above this level could propel the pair towards the major level of 0.6750.
Conversely, key support levels lie at the nine-day Exponential Moving Average (EMA) at 0.6627 and the lower boundary of the ascending triangle around 0.6610. A breach below these levels could lead to further downside pressure, with the pair targeting the major support at 0.6558.
As market participants continue to assess economic data and central bank policies, the AUD/USD pair remains poised for further movements, influenced by both fundamental factors and technical patterns.
