Australian Dollar, AUD/USD, Australia Trade Balance, Technical Outlook-Talking Points
- Asia Pacific Markets may moderate into weekend ahead of US NFP report
- Australian trade data may be a hard-hitting event for the Aussie– Dollar
- AUD/USD trades within Descending Triangle but range quickly closing
Thursday’s Asia-Pacific Outlook
Traders appear to be treading lightly this week as the potentially hard-hitting United States non-farm payrolls report approaches. While the global economic reopening continues to gain momentum, concerns over rapidly rising prices in the economy have economists and investors alike worried that central banks may be forced to tighten policy should inflation measures continue to ramp up. That path, or even the perception of going in the direction, may derail support for rising equity prices.
That said, Asia-Pacific markets may continue to see mixed trading across regional stock indices into the weekend as economic data looms. According to the DailyFX Economic Calendar, analysts expect the US jobs report to post 650k positions in May. A solid figure like that may add fuel to worries in the market that the Federal Reserve may taper its balance sheet premature to prior expectations.
Hong Kong’s Hang Seng Index (HSI) opened modestly lower on Wednesday, but losses accelerated into the close, recording a 0.58% drop. Australia’s ASX 200 fared better following a boost from a stronger-than-expected first-quarter Gross Domestic Product. The Australian Dollar’s reaction was less optimistic, but AUD/USD managed to move 0.18% higher overnight.
Today’s economic docket has several potentially market-moving events, with Australia slated to release trade data for April. Analysts are looking for the figure to cross the wires at A$7.9 billion versus the prior month’s A$5.57 billion print. The April final retail sales figure will also give markets some data to mull, with the economic print expected to drop to 1.1% from 1.3%.
Elsewhere, China will see the Caixin Purchasing Managers’ Index (PMI) report for May, with the prior month’s figure set at 56.3. An improved figure will mark the fourth consecutive gain for the services sector as the Chinese economy continues to ramp up following the country’s reopening post-Covid. Hong Kong and India will also see PMI figures for May come out in Thursday’s trading session.
AUD/USD Technical Outlook:
The 0.7750 level continues to challenge AUD/USD upside, with an intraday move failing to hold above the contentious zone. To the downside, the 50-day Simple Moving Average (SMA), along with the 100-day SMA holds as support, reversing an intraday spike. Price action appears to have formed a Descending Triangle pattern, which could result in a breakout exit from the pattern in the near term.
AUD/USD Daily Chart
Chart created with TradingView
Australian Dollar TRADING RESOURCES
— Written by Thomas Westwater, Analyst for DailyFX.com
To contact Thomas, use the comments section below or @FxWestwateron Twitter