In anticipation of the US non-farm payrolls, speculators kept the AUD/USD currency pair close to last week’s high of 0.7189. For investors, the dollar is losing its appeal and is being replaced by currencies with more risk. There is a re-test of its monthly highs at 0.7266 ahead of Australia’s GDP and the US NFP report.

The US Dollar Index (DXY) dropped to 101.43 in early trading. Due to a weakened US NFP forecast, speculators sold off their safe-haven assets. The number of jobs created in the United States is now projected at 310k, down from the previous estimate of 428k. The Fed’s hawkishness might reduce if NFP numbers fall (Fed). This year, a 50-bps hike in interest rates may be reduced to one instead of the projected three.

Investors in Australia are eagerly awaiting the country’s GDP data on Wednesday. According to the forecast, the GDP might shrink from 4.2 per cent to 1.6 per cent. The quarterly number may fall from 3.4% to 0.6 per cent. The pair might damage by bad performance in the Antipodes.

Nearly 62 per cent retracement of 0.7265/0.6828 dip is found around the 0.7100 level.

Conclusion

According to the above analysis, while the AUD/USD pair may fall in the immediate future, the longer-term outlook is unclear because bulls have a slight advantage, and the pair might swing around 0.7300.