During the 6/12 Asian session, The Australian Bureau of Statistics reported that the economy in May cut 4,800 jobs instead of adding about 10,000 jobs, which was the median expectation from market watchers. April’s reading was revised down dramatically from 14,200 to 10,300.
AUD/USD Reverses Initial Reaction. The immediate reaction in the Aussie was a sell-off. The 4H chart below shows the initial reaction that brought the pair from above 0.9410 to 0.9350. However, when the European session got started, traders reversed this initial reaction, maintaining the prevailing bullish mode that came off the 0.9210 low in May.
AUD/USD Challenging 2014-highs. The fact that the AUD/USD was able to rally despite the poor jobs data shows that the current rally is a threat to the 2014-highs up at 0.9460. The fact that the daily RSI tagged 70, held above 40, and is breaking above 60, reflects maintenance of bullish momentum. A break above 0.9460 opens up the Oct. 2013 high at 0.9756. Also note that the consolidation since April was between 0.92 and 0.9460 – 26 0pips. The range breakout projection above 0.9460 thus targets 0.9720, 260 pips higher than the current high.
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