Originally published by AxiTrader
My report this morning is easy to write.
The Australian dollar was higher this morning because the US dollar can't take a trick, even though the Aussie, among other currencies, came under pressure immediately after the release of US CPI data. But that US dollar strength didn't last long.
As a consequence, the Aussie has risen from a low around 0.7773 to sit at 0.7922 as I write for a gain of around 1.5 cents since about 2 am this morning (I've had much more to say about the overnight price action and the confusion of it in markets morning)
Unemployment had better be a decent print today or all heck is going to break out around 11.30 am.
Of course, while Australia's jobs data has historically been prone to volatility, there is little reason to expect that the markets guesstimate of a 15,000 increase in employment in the month of January is too far off the money.
I say that because the combination of the continued fall in the unemployment expectations index contained in the Westpac consumer sentiment index - recall lower equals less fear of unemployment - and the strength in the NAB business survey.
In particular, the NAB business survey's employment sub-index of +6 is, according to NAB chief economist Alan Oster, is consistent with monthly jobs rises of around 20,000 per month.
So, today's jobs data should not undermine the Aussie dollar's rally.
Again though, Australian employment data is often prone to volatility. And it is a data point I have been wary of since the early 1990's.
To the charts now and the Aussie is at a fascinating juncture.
It has risen back to my slow EMA right at a time when the slow and fast EMA's were about to cross and provide a sell signal. That level is in the 0.7935/45 region. Last week's high at 0.7953/56 region will also be important. If that level, those levels, can be bested the AUD/USD can run all the way back to the recent highs above 81 cents.
Support on the 4-hour charts sits at 0.7864.
Have a great day's trading.