The aussie surges ahead as expectations for a rate cut in November fall
The labour market report earlier may not be stellar but the fact that it wasn't poor is enough to ward off increased bets for the RBA to cut its cash rate again in November.
As the jobless rate came in lower, we have seen the odds of a rate cut slip from ~40% to just about 25% currently as markets ease up on expectations for the time being.
As such, it has seen the aussie pick up some decent gains to start the day with AUD/USD rising back above both key hourly moving averages now.
That means the near-term bias is more bullish but buyers still have much more work to do in order to extend the upside momentum to the next leg.
Much like the start of the week, price action is sort of "caught in the middle" right now.
For buyers, they still need to work their way back above near-term resistance around 0.6800-09 in order to build further momentum. Of note, there are large expiries rolling off today at 0.6800-15 that could play an added role in limiting price gains.
For sellers, it is back to the drawing board as they need to drive price back below the key hourly moving averages @ 0.6769 and 0.6756 respectively. Beyond that, further support is seen closer to 0.6724 and that is the next key level to eye before 0.6700.
Now that the Australian labour market report is out of the way and the dollar tilting a little lower after weaker US retail sales data, it is over to Fedspeak - and US-China headlines - to provide the next set of hints for AUD/USD movement this week.
