Following the heaviest slump in more than a month, AUD/USD retraces some of the losses as it bounced off a 21-day exponential moving average (EMA) while taking rounds to 0.6830 during early Thursday morning Asia.
The Aussie pair followed the market reaction to the US Federal Reserve’s subdued rate cut. The US Dollar (USD) surged across the board even after the Federal Open Market Committee (FOMC) matched market-wide expectations of a 0.25% rate cut. The reason being no such announcements are being expected for the rest of 2019, against one more rate cut anticipated by the markets, coupled with a lack of agreement about the decision among the policymakers. The quarterly economic forecasts were held mostly unchanged while Chairman Jerome Powell held his view that the present alteration is insurance against ongoing risks and not the beginning of a rate cut cycle.
Investors will now focus on August month Employment Change and Unemployment Rate figures for fresh impulse while also taking clues from trade/political headlines and the US data for the rest of the day. The seasonally adjusted Employment Change and Unemployment Rate from Australia might disappoint the Aussie bulls as the forecast suggests a reduction in the formed to 10.0K from 41.1K earlier with an increase in the later to 5.3% versus 5.2% prior.
With the Reserve Bank of Australia (RBA) leaving doors open for further rate cuts if needed, disappointment from labor market numbers could lead to increased expectations of another rate alteration of 2019, which in turn signals the additional weakness of the AUD/USD pair.
AUD/USD LONG (Buy)
ENTER AT: 0.6786