Aussie Dollar Slides Down After US Jobless Claims News

The Australian Dollar (AUD) inched lower against the US Dollar (USD) on Friday, decreasing the price of AUDUSD to less than 0.7800 following some key economic releases. The technical bias shall remain bearish because of a lower low in the ongoing downside move.

AUD/USD Technical Analysis

As of this writing, the pair is being traded around 0.7788. A support can be noted around 0.7500, an immediate horizontal support ahead of 0.7450 the psychological number and then 0.7367, another key horizontal support as demonstrated in the given below chart.

On the upside, a hurdle can be noted near 0.8024, an immediate horizontal resistance level ahead of 0.8100, the psychological level and then 0.8249, the high of the last major upside rally as demonstrated in the given above chart. The technical bias shall remain bearish as long as the 0.8024 resistance area is intact.

US Jobless Claims

The number of Americans filing for unemployment benefits was unchanged last week and the underlying trend remained consistent with a tightening labor market.

U.S. workers filed 245,000 initial claims for state unemployment benefits during the week that ended Dec. 23, according to seasonally adjusted figures published by the Labor Department on Thursday. Data for the prior week was unrevized. Since mid-October, claims have been confined to a range of 223,000 to 252,000.

Economists polled by Reuters had forecast claims edging down to 240,000 in the latest week. Last week marked the 147th straight week that claims remained below the 300,000 threshold, which is associated with a strong labor market. That is the longest such stretch since 1970, when the labor market was smaller.

Trade Idea

Considering the overall technical and fundamental outlook, buying the pair around current levels may be a good strategy in short to medium term.'

Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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