Open an Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open an Account
✖

AU employment miss adds to the Aussie's woes

Article By: ,  Market Analyst
January 18, 2023 8:42 PM

Finally - an interesting employment report arrives for Australia, which could be good for traders but less so for the economy. We have three ‘misses’ with employment change and the participation rate below expectations and the unemployment rate above.

 

The standout figure is employment falling -14.6k, which is its worst since July and below its 3 and 12-month averages of 38.1k and 31.1k respectively. It’s unlikely to derail the RBA from another 25bp hike in February (especially with inflation continuing to rise) but the RBA will keep a close eye on employment change and unemployment to see if it is the beginning of a trend.

 

 

For now, the weak lead form Wall Street - which toppled commodity FX overnight – today’s employment figures are another reason to sell the Aussie, following its rally of the past three months. 

 

AUD/USD daily chart:

There’s a few things to cover here but it al ties in to a pullback for the Aussie (in my humble opinion). It’s had a better-than-expected rally since the October low, which has stalled at the August highs as of yesterday, with a bearish engulfing hammer. The fact the candle high  did not even touch the resistance zone and failed to hold above 0.7000 hints at a potential top. And the fact that we have a 2-month bearish divergence with the RSI (14) and that the AU-US 2yr yield spread remains relatively low compared to the Aussie’s rally provides more conviction for a pullback in my view.

 

However, notice that today’s lows area holding above last week’s VPOC (volume point of control) which may continue to provide some support for now. Ultimately my bias is bearish beneath yesterday’s high, and would consider fading into rallied within yesterday’s candle. Also keep an eye on the S&P 500 as the Aussie is tracking it quite well at the moment, so we would like to see the S&P also roll over as outlined in this TradingView article.

 

 

AUD/JPY daily chart:

We noted yesterday that AUD/JPY was trying to close above 92.0 yesterday following the BOJ meeting – but alas it was not to be. Weak US data saw money flow back into the yen and crush AUD, USD and CAD pairs and AUD/JPY to hand back all of its BOJ gains.

 

The long bearish Pinbar – which failed to hold above an important resistance cluster is also important as it shows a potential swing high. Should sentiment remain risk-off overall, then we suspect AUD/JPY could be headed for the lows around 0.87.

 

 

 

The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

FOREX.com is a registered FCM and RFED with the CFTC and member of the National Futures Association (NFA # 0339826). Forex trading involves significant risk of loss and is not suitable for all investors. Full Disclosures and Risk Warning. Increased leverage increases risk.

GAIN Capital Group LLC (dba FOREX.com) 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA. GAIN Capital Group LLC is a wholly-owned subsidiary of StoneX Group Inc.

© FOREX.COM 2025