AUD/USD erases Wednesday’s strong gains on disappointing jobs report

The AUD/USD pair extended disappointing jobs data-led reversal from 2-month highs and has now erased majority of its strong gains recorded in the previous session.

Currently trading around 0.7665-70 band, the pair came under intense selling pressure and snapped six consecutive days of winning streak after Australia's employment report showed that the number of employed people during the month of September declined by 9.8K as against an expected rise of 15K. Previous month's fall was further revised lower to show a decline 8.9K as compared to -3.9 reported earlier. Meanwhile, the unemployment rate ticked lower to 5.6% from 5.7% (revised higher from 5.6%) recorded in August and was slightly better-than 5.7% expected. 

Disappointing report for the second consecutive month reaffirmed RBA's concerns of weaker labor market conditions and fueled speculations that the central bank might be required to ease its monetary policy, sooner rather than later. 

Later during the day, ECB monetary policy decision and subsequent press conference might infuse volatility in the FX market and provide some impetus for the pair, while US economic releases that include - usual weekly jobless claims, Philly Fed Manufacturing Index and Existing Home Sales data is likely to provide some short-term trading opportunities during NA session.

Technical levels to watch

A follow through selling pressure below 0.7660 level seems to accelerate the slide immediately towards 0.7645 support below which the pair is likely to aim towards 0.7620-15 horizontal support. On the upside, recovery above 0.7690, leading to a subsequent momentum above 0.7700 handle, should assist the pair back towards 0.7720 resistance, which if cleared should pave way for further near-term appreciating move for the pair.