Audusd falls amid improved U.S. labor market data

AUDUSD Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	-0.39%	-24.9 Pips
Week to-date	0.16%	10 Pips
May	0.16%	10.1 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

In the United States, the latest data from the Department of Labor indicates a slight improvement in the labor market, with Initial Unemployment Insurance Claims falling to 227,000 in the week ending 17 May, down from the previous figure of 229,000. This decline in jobless claims suggests a marginal strengthening of the U.S. labor market, as fewer individuals are filing for unemployment benefits. The decrease, although modest, points towards a resilient economy where fewer layoffs are occurring, potentially signaling underlying economic stability or growth. Such data is often closely watched as it can influence monetary policy decisions by demonstrating the health of the labor market.

For the AUDUSD currency pair, which represents the exchange rate between the Australian dollar and the U.S. dollar, the recent drop in the pair’s exchange rate to 0.64088 reflects market reactions to economic conditions. The slight improvement in the U.S. labor market may lead investors to favor the U.S. dollar, perceiving it as a more stable and attractive currency amid a healthier economic backdrop. Consequently, this can lead to a depreciation of the Australian dollar against the U.S. dollar. With no major upcoming economic events, market sentiment driven by such labor market data can continue influencing the exchange rate. The reaction in the AUDUSD could also reflect broader market expectations about potential U.S. economic performance and monetary policy stances in light of these labor improvements. As fewer Americans are filing for unemployment, it can inflate perceptions of U.S. economic vigor, which typically strengthens the U.S. dollar against other currencies such as the Australian dollar.

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What can we expect from AUDUSD today?

AUDUSD on Thursday dropped -0.39% to 0.64088. Price is below 9-Day EMA while Stochastic is falling.

Updated daily direction for AUDUSD looks bearish as the pair posted lower in Thursday trading session.

Looking ahead for the day, immediate support level is at S1 0.63908 with break below could see further selling pressure towards S2 at 0.63727. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 0.64587 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 0.64067 would indicate selling pressure.

For the week to-date, take note that AUDUSD is mixed as compared to the prior week.

Key levels to watch out:

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