AUD/USD Forecast: Further Gains Will Depend On Data

AUD/USD Current Price: 0.7167

• Australian wages grew at the slowest pace since the records began in September 1997.
• Australia is expected to have added 40,000 new job positions in July.
• AUD/USD is heading towards 0.7200, further gains will depend on data.

The AUD/USD pair has managed to post a modest intraday advance on Wednesday, after falling to a fresh weekly low of 0.7108. The early decline followed the release of Australian data, as the country published the Q2 Wage Price Index which was up by 0.2% in the quarter, and rose 1.8% when compared to the second quarter of 2019. That would be the slowest pace of growth on record, and the weakest reading since the records began in September 1997. The pair later recovered on the back of the positive momentum of equities, as most global indexes closed in the green.

During the upcoming Asian session, Australia will release its latest employment figures. The country is anticipated to have recovered just 40K job positions in July, way below the 210.8K added in June. The unemployment rate is expected to have ticked higher to 7.8% from 7.4% in the previous month, while the participation rate is seen rising from 64% to 64.4%.  The market is anticipating a dismal reading, which means that the numbers need to diverge strongly from forecast to have a negative impact on the Aussie.

AUD/USD short-term technical outlook

The AUD/USD pair is trading at around 0.7160, neutral-to-bullish in the short-term. The 4-hour chart shows that the price has advanced above the 20 and 100 SMA, both converging around 0.7150. Technical indicators, in the meantime, entered positive territory but lost directional strength, now flat within neutral levels.

Support levels: 0.7145 0.7110 0.7070  

Resistance levels: 0.7185 0.7220 0.7260

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