AUDUSD Forecast – Reaction to US Non-Farm Payrolls Data, .6760 Pivot Sets the Tone

The Australian Dollar is edging higher on Friday, inside Monday and Tuesday’s wide range for a second session. The price action suggests investors may be bracing for today’s major U.S. monthly jobs report.

Gains are being capped after a week of wild swings as a run of upbeat jobs data supported its U.S. counterpart, while bonds held gains on signs global inflation was cooling.

At the same time, underpinning the Aussie is demand from Japanese investors and reports China was preparing to resume coal imports from Australia after a two-year freeze, spurring hopes Beijing might also ease bans on wine and barley.

At 03:48 GMT, the AUDUSD is trading .6776, up 0.0024 or +0.36%. On Thursday, the Invesco CurrencyShares Australian Dollar Trust ETF (FXA) settled at $67.96, up $0.30 or +0.44%.

Traders Eyeing US Non-Farm Payrolls

Overall non-farm payrolls are forecast to have advanced by 200,000 jobs. The economy created 263,000 jobs in November. Average Hourly Earnings is expected to have risen by 0.4%, down from 0.6% and the Unemployment Rate is expected to come in unchanged at 3.7%.

A stronger than expected reading will support the Fed’s plan to raise interest rates. This could strengthen the U.S. Dollar while putting pressure on the Australian Dollar.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through .6688 will change the main trend to down. A move through .6886 will signal a resumption of the uptrend.

The major support is the long-term 50% level at .6760. The closest resistance is the short-term Fibonacci level at .6792.

Daily Swing Chart Technical Forecast

Trader reaction to the long-term 50% level at .6760 will determine the direction of the AUDUSD on Friday.

Bullish Scenario

A sustained move over .6760 will signal the presence of buyers. The first upside target is the short-term Fibonacci level at .6792. This is a potential trigger point for an acceleration to the upside with potential targets this week’s high at .6886, the Dec. 13 main top at .6893 and the Sept. 13 main top at .6916.

Bearish Scenario

A sustained move under .6760 will be a sign of weakness. This could trigger an acceleration to the downside with the next target this week’s low at .6688, followed by a support cluster at .6639 – .6629.