AUD/USD Pulls Off Session Highs to Trim Weekly Gains After US NFPs

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The AUD/USD currency pair on Friday retracted from the daily highs of about 0.6857 to settle around 0.6830 after the latest round of US non-farm payrolls. The currency pair has been trading in a cyclical consolidative pattern since breaking out from a downward trending wedge at the start of the week.

The pair made a bullish breakout that resulted in one of the biggest single-day rallies in recent months. This rally pushed it to overbought levels of the RSI indicator in the 60-min chart but has since pulled back to trade within the normal trading zone.

AUD/USD Fundamentals Overview

From a fundamental perspective, the AUD/USD currency pair is trading at the back of a very busy period in both the Australian and the US markets. Besides the recent positive developments around trade talks with China, today we also saw the release of the NFPs.

And according to the data published on Friday, the US labor market added a whopping 266k jobs during the month of November, which beat the expectation of 180k jobs. On the other hand, wage growth eased to 3.1% (YoY) from 3.2% in the previous month, but still, beat the consensus estimate of 3.0%.

Earlier in the week, the US ISM Manufacturing PMI missed the expectation of 49.2 with 48.1 while the non-Manufacturing PMI had a narrower miss after delivering 53.9 versus an expectation of 54.5.

In Australia, the Reserve Bank of Australia (RBA) on Tuesday kept the cash rate unchanged at 0.75% but analysts expect a cut soon in a bid to boost economic growth. The Q3 GDP also missed the expectation of 0.5% (QoQ) after dropping from 0.6% to 0.4%.

AUD/USD Technical Analysis (the 60-min Chart)

Technically, the AUD/USD currency pair appears to have met strong resistance around the 0.6860 level. The currency pair bottomed at around 0.6760 last week but has since rallied to top 0.6860 before Friday’s post-NFPs pullback.

The bears will be targeting short-term profits at around 0.6820 or lower at 0.6810 going into the weekend. On the other hand, the bulls will hope for another rebound towards 0.6840 and o.6860.

AUD/USD Technical Analysis (the Daily Chart)

In the daily chart, the AUD/USD currency pair continues t trade within a descending channel, which indicates a significant bearish bias in the market sentiment. The pair is pegged just above the 100-day SMA line and a few more pips below the 200-day SMA.

Going into next week, the bulls will be targeting long-term profits at around 0.6940 or higher at 0.7050. On the other hand, the bears will hope for a major pullback towards 0.6760 or lower at 0.6670.

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