Good morning,
Welcome to our daily market update where we help keep you informed on the latest happenings in the world of FX and show you what this means for the Mighty Aussie Dollar.
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Key Data Being Released Today Monday the 6th of December 2021
- No real impactful date during the day
The Aussie Dollar – Fundamentals
During the New York session (Early Saturday Morning Our Time), after a not-so-bad US Nonfarm payrolls report, the AUD/USD dropped sharply to fresh year-to-date lows. Trading at a low of 0.6993, closing 1.4% down. This is the first time the Aussie Dollar has traded under 0.7000 against the USD since July 2020. As portrayed by US equity indices falling, market sentiment is downbeat after the US Bureau of Labor Statistics (BLS) unveiled that the Nonfarm Payrolls for November grew less than expected. However, the Unemployment Rate fell three tenths from 4.5% to 4.2%.
In tone with the risk-off mood, in the FX market, risk-sensitive currencies like the Aussie Dollar, were the main losers of the day, contrary to the greenback, which took advantage of its safe-haven status.
While the Aussie Dollar was dropping, the St. Louis Fed President James Bullard crossed the wires, where he said the US economy has recovered and is poised to grow. Noted that in the following meetings, the Fed would need to consider a faster bond taper reduction, citing that a 4.2% jobless rate “as a good case to remove Fed support.” Bullard also commented that the US central bank could consider increasing rates before finishing the bond taper
The Aussie Dollar – Technical Analysis
An interesting statement from Credit Suisse analysis overnight stating “AUD/USD has finally closed below major support at 0.7106, which we look to be sustained into the weekly close given that the trend picture remains strongly negative. This would confirm a much larger long-term top, which would turn the long-term risks lower and suggest that aggressive further weakness is likely.”
Resistance on the Top Side – If the market rebounds higher resistance will start at 0.7110, then 0.7172 and 0.7300.
Support on the Downside – We will be watching the market very closely today to determine if the market will break, they key technical and psychological level of 0.7000. If the market continues to fall there is the support at 0.6921 and then at 0.6800 psychological support at 0.7000 and beyond that 0.6800.
AUD/USD Daily Chart
DXY (USD INDEX) Daily Chart
Major Global Markets
- Stocks
- S&P 500 closed at 4538
- NASDAQ closed at 15698
- ASX 200 closed at 7225
- Currencies
- AUD/USD – At the time of writing this report trades at 0.6998
- AUD/JPY – At the time of writing this report trades at 79.12
- AUD/CNH – At the time of writing this report trades at 4.4608
- DXY (US Dollar Index) – At the time of writing this report trades 96.176
- AUD/EUR – At the time of writing this report trades 0.6196
- Bonds
- US 10-year Bonds are currently at 1.346
- Aussie 10-year Bonds are currently at 1.568
- Commodities
- Iron Ore 62% – Trading at USD/T 101.49
- Gold – trading at USD/OZ 1782
