Having rebounded near the key support at US$0.6870-80, the Australian dollar has remained on the front foot against its USD rival.
In economic data, the overnight release of the U.S. ISM Services PMI for July rose to 56.7 from 55.3 prior and the market expectation of 53.5.
Much volatility is seen ahead as investors look to this week’s main event, the U.S. Non-Farm Payrolls (NFP) report.
The U.S. Labour Department’s jobs report is expected to show whether employers kept hiring in July after 372,000 jobs were added in June, with the forecast currently holding at 250,000, and the unemployment rate is expected to hold steady at a historic low of 3.6%.
However, before the (NFP) release, we also get (earlier) the release of the RBA monetary policy statement.
Based on the daily technical assessment, the Relative Strength Index (RSI) 3-day ‘lookback’ indicator is mixed, while the Moving Average Convergence Divergence (MACD) oscillator supports a weak positive signal. The ADX indicator supports a ranging market.
While the US$0.6870-80 support is intact further bullish momentum is expected.
As the rebound slowly strengthens, bullish eyes look to US$0.6995. Reassess from there.
Conversely, a close below US$0.6870-80 would reinstate the bearish sentiment and expose the region to US$0.6775.