AUD/USD forecast after the strong Australian jobs data

The AUD/USD tilted higher on Thursday morning after the latest Australian jobs data. The pair is trading at 0.7237, which was slightly higher than this week’s low of 0.7175.

Australia jobs data

The Australian economy is doing relatively well as the country reopens and as demand from China rises. According to the Australian Bureau of Statistics (ABS), the country’s unemployment rate retreated to 4.2% in December. That was a better number than the median estimate of 4.5%. 

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The economy added over 64.8k jobs in December, which was significantly lower than the median estimate of 43.3k. In November,  the country added over 366k jobs as the country’s states started ending their lockdowns.  The participation rate remained unchanged at 66.1%.

These numbers show that the economy is doing relatively well although challenges remain. If the trend continues, analysts believe that the Reserve Bank of Australia (RBA) will start tightening in the third or fourth quarter of 2021.

Additional data from Australia have been relatively strong lately. For example, retail sales jumped sharply in December helped by Christmas shopping. The manufacturing and services PMIs also did well in December.

However, earlier this week, the AUD/USD pair reacted to the weak Australian consumer confidence data. According to Westpac, confidence declined by about 2% to 102.2 points in January. The biggest concern among consumers is that some states are sill implementing restrictions and vaccine mandates in the country.

Looking ahead, the AUD/USD pair will next react to the key economic data scheduled from the United States. The Labor Department will publish the latest initial jobless claims data later today. Also, the US will publish the latest existing home sales data. On Wednesday, data by the Commerce Department showed that the country’s building permits and housing starts did well in November.

AUD/USD forecast

On the four-hour chart, we see that the AUD/USD pair tilted higher after the latest Australian jobs data. It is trading at 0.7231, which is slightly above the lower side of the ascending channel. The pair has moved slightly above the 38.2% Fibonacci retracement level. 

It is also attempting to move above the Ichimoku cloud. Therefore, the pair will likely keep rising as bulls target the upper side of the channel at about 0.7300.

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