FX News – Jan 16 2014: Dismal AU Employment Data Drags AUD/USD to 0.88

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The aussie tumbled against the greenback in today's trading as Australia posted dismal employment data earlier today. While the country's Unemployment Rate in December has remained steady at 5.8%, the main reason for the decline in the aussie were the other employment figures during the same period. 

Employment Change saw a massive drop from the previous growth of 15,400 to a decline by 22,600. This was far from analysts’ expected growth by 7,500. In addition, Fulltime Employment also fell by 31,600, compared to a rise by 10,500 in the previous period. Part-time employment fared a little better as it rose by 9,000 in December. Meanwhile, participation rate was at 64.6 per cent, which was lower than the previous 64.8 per cent and the expected 64.8 per cent.

From hovering around the 0.8900 area earlier today, the AUD/USD pair almost immediately lost 100 pips after the release of the Australian employment data. It is currently trading at 0.8812, with initial resistance seen at 0.8942, followed by 0.8964. Meanwhile, initial support is at 0.8856, followed by 0.8834.

As for the GBP/JPY pair, the yen go a lift from Japans' positive Machinery Orders in November. It rose by 16.6 per cent over the past 12 months, and by 9.3 per cent compared to the previous month. While the 12-month growth was lower than the previous period (17.8 vs 16.6 current), it grew significantly in a month. Previously, it only grew by 0.6 per cent.

Although the pair tested the 171.70 level today, it was unable to sustain it and has since returned to the 171.20 zone. Analysts continue to expect traders to have a negative outlook on the GBP/JPY in the long term.

The pair is currently trading at 171.21, with initial resistance seen at 171.45, followed by 171.88. Meanwhile, initial support is at 170.28, followed by 169.85. 

By FX Strategy Team, Published on 16th of January 2014
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