Australian Dollar wobbles as the technical implications break down

January 14, 2021 - 6 days ago
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The Australian dollar retreated slightly on Wednesday while the broad US dollar recaptured its bullish charm and rebounded after its modest retreat on Tuesday.

Having touched an intraday high of US$0.7780, markets largely ignored a strong uptick in job vacancies despite the run-on implications for a sharp correction in unemployment rates and upward inflation expectations.

According to the Bureau of Statistics (ABS), the number of job vacancies in Australia surged to 254,000 in the November quarter, in the latest sign that Australia’s economy is recovering quickly from COVID-19.

Looking ahead, the attentions turn to the U.S. unemployment claims and commentary from Fed Chairman Jerome Powell as key markers for monetary policy and economic performance, which could trigger some volatility.

Viewing the technical assessment, from the recent break of US$0.7725 should keep the bearish evaluation to a slow decline towards a potential target of US$0.7655-60, then to US$0.7570-75. Reassess from there.

However, a close above the resistance at US$0.7795 would negate the downside call and give a short-term neutral view.

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