COZfx: AUD/USD pulls back from 5-month highs on profit-taking

[kiriss5678]

COZforex: The Australian dollar was lower against its U.S. counterpart on Wednesday, as investors locked in gains after the Aussie rallied to five-month highs against the greenback on Tuesday, on the back of disappointing US employment data.

AUD/USD hit 0.9632 amid late Asian trade, the pair's lowest since October 18; the pair subsequently consolidated at 0.9652, dropping 0.60%. COZforex senior currency strategist Ian • Quigley said, AUD/USD is predicted to find support at 0.9642, and a decline through could take it to the next support line of 0.9584. Meanwhile, the pair is predicted to find its first resistance at 0.9759, and a rise through could take it to the next resistance line of 0.9818.

The greenback weakened broadly on Tuesday after the Department of Labor said the US economy added 148,000 jobs in September, well below expectations for an increase of 180,000. The US unemployment rate ticked down to a four-and-a-half year low of 7.2% from 7.3% in August, but this was partially due to more people dropping out of the labor force.

The jobs report was released 18 days behind schedule due to disruption caused by the US government shutdown. The disappointing data reinforced expectations that the Federal Reserve will maintain the current pace of its asset purchase program well into next year.

In Australia, official data showed that consumer price inflation rise by 1.2% in the third quarter, exceeding expectations for a 0.8% increase, after a 0.4% rise in the 3 months to June.

Trimmed mean consumer price inflation, which excludes the most volatile 30% of items, rose 0.7% in the September quarter, more than the expected 0.6% uptick, after an upwardly revised 0.6% increase in the second quarter. In a separate report, the Conference Board said its leading index for Australia decline 0.2% in August, after a 0.3% rise the previous month.

(COZ forex UK)