Forex: AUD/USD- Trading the Australian Employment Report

RELATED QUOTES

SymbolPriceChange
AUDUSD=X0.7607-0.0009

Trading the News: Australia Employment Change

What’s Expected:

Time of release: 01/16/2013 0:30 GMT, 19:30 EST

Primary Pair Impact: AUDUSD

Expected: 4.5K

Previous: 13.9KK

DailyFX Forecast: 0.0K to 10.0K

Why Is This Event Important:

The Australian economy is expected to add another 4.5K jobs in December and the ongoing improvement in the labor market may spark a bullish reaction in the AUDSD as it dampens speculation for additional monetary support. However, the Reserve Bank of Australia (RBA) held a rather cautious tone for the $1T economy after cutting the benchmark interest rate to 3.00% at the last meeting on December 3, and a dismal employment report may prompt the central bank to further embark on its easing cycle as policy makers look for a stronger recovery.

Recent Economic Developments

The Upside

Release

Expected

Actual

Westpac Consumer Confidence s.a. (MoM) (JAN)

--

0.6%

Inventories (3Q)

0.4%

1.1%

Private Capital Expenditure (3Q)

2.0%

2.8%

The Downside

Release

Expected

Actual

ANZ Job Advertisements (MoM) (DEC)

--

-3.8%

Retail Sales s.a. (MoM) (NOV)

0.3%

-0.1%

Trade Balance (NOV)

-2300M

-2637M

The rise in business inventories along with the expansion in private investments may encourage a strong uptick in employment, and a positive development may increase the appeal of the aussie as the data dampens expectations for another rate cut. However, as the resource boom comes to an end, the drop in global trade paired with the slowdown in private sector consumption may drag on hiring, and we may see businesses keep a lid on their labor force as the region faces an uneven recovery.

Potential Price Targets For The Release

Forex_AUDUSD-_Trading_the_Australian_Employment_Report_body_ScreenShot183.png, Forex: AUD/USD- Trading the Australian Employment Report

Although the AUDUSD continues to trade within the upward trending channel dating back to October, the relative strength index remains capped by the 67 figure, and the pair could be carving out a lower top just below the 1.0600 figure as the oscillator comes off of overbought territory. In turn, we may see the aussie-dollar fall back towards the 61.8% Fibonacci retracement from the 2011 high to low around 1.0430, but we may see the high-yielding currency threaten the bullish trend carried over from the previous year should the employment report fuel bets for more monetary support.

How To Trade This Event Risk

Forecasts for another rise in employment encourages a bullish forecast for the high-yielding currency, and a positive development may set the stage for a long Australian dollar as market participants scale back bets for another rate cut. Therefore, if the $1T economy adds 4.5K jobs or more in December, we will need to see a green, five-minute candle following the print in order to generate a buy entry on two-lots of AUDUSD. Once these conditions are met, we will set the initial stop at the nearby swing low or a reasonable distance from the entry, and this risk will establish our first objective. The second target will be based on discretion, and we will move the stop on the second lot to cost once the first trade hits its mark in an effort to lock-in our gains.

In contrast, the ongoing weakness in the real economy paired with the slowdown in global trade may sap hiring, and a dismal print should drag on the exchange rate as it dampens the fundamental outlook for the region. As a result, if employment falls short of market expectations, we will carry out the same strategy for a short aussie-dollar trade as the long position laid out above, just in the opposite direction.

Impact that the change in Australia Employment has had on AUD during the last month

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

NOV 2012

12/06/2012 0:30 GMT

0.0K

13.9K

+28

+41

November 2012 Australia Employment

Forex_AUDUSD-_Trading_the_Australian_Employment_Report_body_ScreenShot182.png, Forex: AUD/USD- Trading the Australian Employment Report

Australian employment increased another 10.7K in November after expanding a revised 10.2K the month prior, while the jobless rate slipped to 5.2% from 5.4% as discouraged workers left the labor force. The unexpected rise in job growth sparked a bullish reaction in the Australian dollar, with the AUDUSD climbing above the 1.0450 figure, and we saw the high-yielding currency gain ground throughout the day as the pair closed at 1.0484.

To contact David, e-mail dsong@dailyfx.com.

Follow me on Twitter at @DavidJSong

To be added to David's e-mail distribution list, please follow this link.

New to FX? Watch this Video

Questions? Comments? Join us in the DailyFX Forum

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.

--

Get stories like this on the Yahoo app and discover more every day.
Download it now.
Loading...
  • North Korea test-fires sub-launched missile close to Japan
    North Korea test-fires sub-launched missile close to Japan AFP News - 5 minutes ago

    North Korea on Wednesday test-fired a submarine-launched missile 500 kilometres (around 300 miles) towards Japan, marking what weapons analysts called a clear step forward for its nuclear strike ambitions. … More »

  • Ex-Comverse CEO pleads guilty to fraud, a decade after fleeing U.S.
    Ex-Comverse CEO pleads guilty to fraud, a decade after fleeing U.S. Reuters - 7 minutes ago

    The former chief executive officer of Comverse Technology Inc pleaded guilty on Wednesday to securities fraud, a decade after he fled to Namibia from the United States to avoid prosecution. Jacob "Kobi" Alexander, the Woodbury, New York-based … More »

  • U.S. crude down 3 percent after big stockpile build
    U.S. crude down 3 percent after big stockpile build Reuters - 30 minutes ago

    The U.S. Energy Information Administration (EIA) said crude inventories rose 2.5 million barrels last week, versus analysts' forecasts for a draw of 500,000 barrels. U.S. West Texas Intermediate (WTI) futures settled down $1.33, or 2.8 percent, at … More »

  • European stocks rebound as euro slips; oil tumbles
    European stocks rebound as euro slips; oil tumbles Reuters - 37 minutes ago

    European stocks scored consecutive daily gains for the first time in three weeks on Wednesday, drawing support from a weak euro, but U.S. and Canadian stocks drifted down as lower metal and oil prices weighed on the materials sector. Emerging … More »

  • EU, Portugal agree on 5 billion euro recapitalisation for ailing bank CGD
    EU, Portugal agree on 5 billion euro recapitalisation for ailing bank CGD Reuters - 41 minutes ago

    LISBON/BRUSSELS (Reuters) - The European Commission and Portugal have agreed in principle on the recapitalisation, on market terms, of ailing state-owned bank CGD, envisaging an injection of up to 2.7 billion euros (£2.3 billion) in state funds and … More »

  • Ecuador, Iran officials meet on need to stabilise oil prices Reuters - 1 hour 4 minutes ago

    QUITO (Reuters) - Ecuador's Foreign Minister Guillaume Long said on Wednesday that the South American country's authorities spoke with a visiting Iranian delegation about the need to stabilise oil prices. ... … More »

  • Syria rebels backed by Turkey tanks 'seize' IS-held town
    Syria rebels backed by Turkey tanks 'seize' IS-held town AFP News - 1 hour 5 minutes ago

    Turkish tanks and hundreds of opposition fighters thrust deep inside Syrian territory Wednesday in a lightning operation that within hours ousted Islamic State jihadists from a key Syrian border town. The air and ground offensive -- the most … More »

  • Wall St. declines as healthcare, materials lag
    Wall St. declines as healthcare, materials lag Reuters - 1 hour 6 minutes ago

    Wall Street retreated on Wednesday, pulled lower by declines in the materials and healthcare sectors as investors continued to assess the possibility of an interest rate hike in the coming months. The market is awaiting Federal Reserve Chair Janet … More »

  • The Latest: 8-year-old pulled out alive from quake rubble
    The Latest: 8-year-old pulled out alive from quake rubble Associated Press - 1 hour 9 minutes ago

    The Latest on the earthquake in central Italy (all times local): 8:35 p.m. An 8-year-old girl has been pulled alive from the rubble in Pescara del Tronto, one of the three towns most severely demolished ... … More »

  • Stocks edge lower as mining and materials companies slip
    Stocks edge lower as mining and materials companies slip Associated Press - 1 hour 24 minutes ago

    U.S. stocks are edging lower in afternoon trading on Wednesday, giving back a modest increase from the day before. The declines, which were led by mining and materials companies, were light but broad as ... … More »

  • Copper Drops to Erase Year’s Gains on LME as China Imports Slide Bloomberg - 1 hour 51 minutes ago

    Glencore Plc, the top copper supplier, fell after reporting profit declined by two-thirds. Copper for delivery in three months declined 1.7 percent to settle at $4,632 a metric ton ($2.10 a pound) at 5:50 p.m. on the LME, capping the longest … More »

  • Russia jails leader of banned nationalist group
    Russia jails leader of banned nationalist group AFP News - 2 hours 34 minutes ago

    A Russian court on Wednesday sentenced ultranationalist politician Alexander Belov, a former leader of a banned anti-immigration movement, to seven and a half years in prison for extremism and money laundering. Belov was formerly coordinator of the … More »

  • Euro area banks see net profit fall 20 percent in first quarter - ECB
    Euro area banks see net profit fall 20 percent in first quarter - ECB Reuters - 2 hours 45 minutes ago

    Euro area banks saw their profits fall by a fifth in the first three months of this year as they made less money from trading and most other business areas, European Central Bank data showed on Wednesday. The ECB survey painted a gloomy picture, … More »

  • European equities mainly rise on German GDP
    European equities mainly rise on German GDP AFP News - 2 hours 55 minutes ago

    European stock markets made limited gains Wednesday after a downbeat session in Asia, with sentiment partly lifted by German economic growth data. Strong foreign trade and buoyant consumption drove Germany's economy, Europe's largest, to … More »

  • Oil slides on surprise jump in US crude stockpiles AFP - 3 hours ago

    Oil prices slumped Wednesday as a surprise jump in US crude stockpiles added to lingering concerns over a global supply glut. The US Department of Energy said commercial inventories of US crude grew by ... … More »

  • Global Markets - European stocks rebound as euro slips; oil tumbles
    Global Markets - European stocks rebound as euro slips; oil tumbles Reuters - 3 hours ago

    European stocks scored consecutive daily gains for the first time in three weeks on Wednesday, drawing support from a weak euro, but U.S. and Canadian stocks drifted down as lower metal and oil prices weighed on the materials sector. On a light day … More »

  • FTSE underperforms European peers, miners hinder
    FTSE underperforms European peers, miners hinder Reuters - 3 hours ago

    Britain's blue-chip share index retreated on Wednesday, underperforming its European peers, as a sharp drop in metals prices put pressure on the mining sector and South Africa-exposed stocks fell as the rand slipped. Glencore GLEN.L was down 3.1 … More »

  • Up 57 percent, Britain's inflation-linked gilt tops all bonds in 2016 Reuters - 3 hours ago

    The longest-dated UK government index-linked gilt has been the best performing government bond of 2016 as investors scramble to buy inflation protection in the wake of Britain's shock decision to leave the European Union. The UK government's 0.125 … More »

  • Sensors, other devices can help prevent hot car deaths
    Sensors, other devices can help prevent hot car deaths Associated Press - 3 hours ago

    Hot cars are a danger to children, particularly in a sweltering summer like this one. There are some devices on the market — built into cars as well as child seats — that can help prevent kids from being ... … More »

  • Markets Right Now: US stocks edge lower at midday Associated Press - 3 hours ago

    The latest on developments in global financial markets (all times local): 11:45 a.m. Stocks are moving slightly lower in midday trading on Wall Street as the market gives back a modest gain from the day ... … More »

  • China’s Shadow Finance Is Reminiscent of Pre-Crisis U.S.: Q&A Bloomberg - 3 hours ago

    The nation has at most about 18 months before this funding -- derived largely from wealth-management products offering higher returns on riskier underlying investments -- hits a wall, says Wright, director of China markets strategy for New … More »

  • New PBOC Money-Market Tactic Has Traders Trying to Decode Signal Bloomberg - 3 hours ago

    The People’s Bank of China sold 50 billion yuan ($7.5 billion) of 14-day reverse-repurchase agreements on Wednesday, its first offering of anything with a tenor other than seven days since February. Officials are signaling they’re ready to curb … More »

  • Italy quake unlikely to trigger 200 mln euro cat-bond default
    Italy quake unlikely to trigger 200 mln euro cat-bond default Reuters - 3 hours ago

    A powerful earthquake in Italy on Wednesday is unlikely to force UnipolSai's 200 million euro ($226 mln) catastrophe bond into default as the bond has low exposure to the affected region, the Italian insurer said. The earthquake devastated a string … More »

  • Glencore’s Worst Profit Shows Miners Still Reeling From Rout (1) Bloomberg - 3 hours ago

    Weak raw-material prices caused profit at the commodities giant to plunge 66 percent in the first half to $300 million. The shares dropped 3.1 percent in London even as Glencore promised to cut debt even further and said it may resume paying … More »

  • TABLE-INDONESIA KPB NUSANTARA PALM OIL PRICES - Aug 24 Reuters - 4 hours ago

    Aug 23 (Reuters) - Following are Indonesian prices for crude palm oil (CPO) quoted at an auction by PT KPB Nusantara (formerly known as the state marketing centre) on Monday. Buyer Volume Price Terms (tonnes) ... … More »

 
Recent Quotes
Symbol Price Change % Chg 
Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
You need to enable your browser cookies to view your most recent quotes.
 
Sign-in to view quotes in your portfolios.

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.1290.0000.00%
    N21.SI
    0.250.00-1.96%
    5ME.SI
    0.60+0.04+6.57%
    5TP.SI
    0.99-0.02-1.98%
    Y92.SI
    0.156+0.007+4.70%
    AFC.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.30+0.06+22.45%
    T18.SI
    0.15+0.02+15.38%
    5TI.SI
    0.225+0.025+12.50%
    Y35.SI
    0.51+0.05+12.09%
    BHU.SI
    0.162+0.017+11.72%
    QS9.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.011-0.115-91.27%
    QF6.SI
    0.23-0.17-42.50%
    AWI.SI
    0.205-0.055-21.15%
    I06.SI
    0.45-0.10-18.18%
    BFK.SI
    0.385-0.085-18.09%
    E8Z.SI

Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.3546+0.0033+0.24%
    USDSGD=X
    1.5258-0.0012-0.08%
    EURSGD=X
    1.7919+0.0092+0.52%
    GBPSGD=X
    74.1290+0.02+0.03%
    SGDJPY=X
    5.7214-0.0141-0.25%
    SGDHKD=X
    2.9751-0.0007-0.02%
    SGDMYR=X
    9,777.2441-39.46-0.40%
    SGDIDR=X
    4.9103-0.0031-0.06%
    SGDCNY=X
    1.0304+0.0015+0.15%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,328.60-17.50-1.30%
    GCZ16.CMX
    18.52-0.40-2.10%
    SIU16.CMX
    95.57-8.32-8.01%
    ^XAU
    2.08-0.04-1.75%
    HGU16.CMX
    46.70-1.40-2.91%
    CLV16.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.140.00
    ^FVX
    1.56+0.01
    ^TNX
    2.24+0.01
    ^TYX