Market News

Bullish AUD/USD: Australian Dollar Rises on Robust Wage Growth

AUD/USD Australian wage growth

Discover the latest on Australian wage growth, its impact on AUD/USD, and critical levels in this market analysis.

Australian wage growth has reached its highest point since 2009, contributing to the current buoyancy of the Australian dollar. The optimistic Chinese economic data, combined with the post-CPI rally that led to a Greenback sell-off, has further supported the AUD. The robust wage growth raises the possibility of sticky inflation, prompting the potential tightening of monetary policy by the Reserve Bank of Australia (RBA).

Bullish AUD/USD: Australian Dollar Rises on Robust Wage Growth

In addition to the wage growth, the AUD benefits from higher prices of precious and base metals. 

We are looking ahead, focusing on the US Producer Price Index (PPI) and retail sales data. PPI is considered a leading indicator that provides insights into potential future inflation (CPI). If the actual data aligns with estimates, the US dollar could further weaken.

Technical Analysis

The AUD/USD pair is currently hovering around the psychological level of 0.6500, which has remained resilient since mid-August. However, indications suggest that this level may face a test soon. A close above the November swing high is crucial for bullish momentum, with the 200-day moving average as the next zone of interest for potential upward movement.

Key Resistance Levels

  • 0.6596
  • 200-day Moving Average

Support

  • 0.6459
  • 50-day Moving Average
  • 0.6358

IG Client Sentiment Data

According to IG Client Sentiment (IGCS) data, retail traders are currently net LONG on AUD/USD, with 62% of traders holding long positions. This sentiment may influence market dynamics in the near term.

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