Aussie traders are in for a busy week as Australia prints top-tier and closely watched data while China releases a data dump.
Which potential catalysts should you focus on?
Let me help you out:
Labor market data (Jan 21, 12:30 am GMT)
- An improvement in Victoria’s labor market saw the country’s jobs increase by a net of 90,000 against expectations of a 50,000 uptick
- Jobless rate inched lower from 7.0% to 6.8% while the labor force participation rate climbed from 65.8% to 66.1%
- There were no other catalysts at the time so Aussie traders priced in (as in bought AUD) at the upside surprises
- Markets see another 40,000 net job additions in January
- Unemployment rate could inch back up to 7.0% while participation rate is seen improving to 66.2%
Lowe-tier releases
- MI inflation expectations (Jan 21, 12:00 am GMT) to inch lower from 3.5% to 3.4%
- Markit’s manufacturing PMI (Jan 21, 10:00 pm GMT) could dip from 55.7 to 55.1
- Markit’s services PMI seen weakening from 57.0 to 56.5
- Retail sales (Jan 22, 12:30 am GMT) could drop by 3.0% after a 7.0% jump in October
- Quarterly GDP could speed up from 2.7% to 3.0% in Q4 2020
- Fixed asset investment (ytd/y) to improve from 2.6% to 3.2%
- Annual industrial production seen at 7.1% after 7.0% growth
- Annual retail sales could rise by 5.1% after a 5.0% increase in November
- Unemployment rate to remain at 5.2% in December
Overall risk appetite
- Policy decisions from the Bank of Canada (BOC), Bank of Japan (BOJ), and the European Central Bank (ECB) will give clues on global monetary stimulus trends
- Manufacturing PMIs from the U.S., U.K., Eurozone, and Japan will paint a picture of the recovery of global manufacturing
- COVID-19 updates (number of cases, vaccine schedule, lockdown prospects) will continue to affect the demand for high-yielding currencies like the Aussie
- Australia’s trade conflict with China can influence iron ore prices – one of Australia’s major exports – and affect AUD’s intraweek trends
Technical snapshot
- AUD is hitting “overbought” levels on the daily Keltner Channels
- AUD may soon hit overbought conditions against EUR, CHF, and CAD on the daily time frame
- EMAs show the low-key bearish pressure AUD is receiving against most of its major counterparts
- The Aussie remains on short and long-term bullish trends against the euro and Kiwi
- The Aussie saw the most volatility against the safe-havens and the euro in the last seven days
