Halister News

(Bloomberg) -- After breaking long-term support, the AUD/USD is eyeing the July low of 0.7408, especially if Thursday’s jobs report misses forecast, writes Bloomberg strategist Michael G. Wilson.

• Relief rally from the 0.7460 overnight low so far has been limited to 0.7497 and is well under the 200-DMA at 0.7512; spot now at 0.7474
• Slow stochastics %K and RSI momentum indicators at 18 and 35, respectively, are more directional than oversold at this stage, and may allow for further losses
• Employers probably added a net 16k jobs in October after shedding 9.8k in Sept., according to median est. in Bloomberg survey; range of ests. -3k to +40k; data due at 11:30am local
• Unemployment rate is seen ticking up to 5.7% from 5.6%
• RBA will watch not only the headline numbers but the balance between full-time and part-time jobs; an erosion in full- time roles has fed worries about wage growth, as flagged in the bank’s recent quarterly statement on policy
• After the labor data, the Aussie’s next major catalyst is testimony from Fed’s Yellen, also Thursday; the market is pricing in a 94% chance of a December rate hike, and Jefferies says the Fed may try to cool expectations a bit given the dollar’s recent surge
• NOTE: Michael G. Wilson is an FX strategist who writes for First Word. The observations he makes are his own.