AUD/USD supply coming in at key 2013-2017 downtrend

Currently, AUD/USD is trading at 0.7672, up 1.19% on the day, having posted a daily high at 0.7698 and low at 0.7577.

AUD/USD is meeting supply just shy of the 0.77 handle having met new highs for the year driven by copper prices. " There isn't any point fighting AUD strength until commodity prices stabilise," argued Kit Juckes, an economist at Societe Generale. At the same time, AUD December trade surplus widened from $A2b to $A3.5b, driven by a +6.7%/mth jump in goods exports (after Nov’s outsized +12.7%/mth) and supported by a more-benign-than-expected import bill, rising just +0.7%/mth, as noted by analysts at TD Securities. "Although this trade surplus was welcome, our work suggests the trade sector could slice up to 0.2% pts off GDP." 

NFP Forecast: Will strong payrolls & wage growth help US dollar regain poise?

We now await the nonfarm payrolls report tomorrow and if the ADP report and manufacturing jobs data was anything to go by, we could be in for a solid outcome. "The Non-Farm Payrolls figure due this Friday is expected to show the economy added 175K jobs in January. The December print was 156K. The unemployment rate is seen unchanged at 4.7%. The average hourly earnings growth is seen slowing to 0.2% m/m from January figure of 0.4%," explained Omkar Godbole, an analyst at FXStreet.

AUD/USD levels

AUD/USD rallied through 0.7645 and the Fibo resistance and in doing so has started to erode the 2013-2017 downtrend, noted analysts at Commerzbank. "We will need to see a close above 0.7645 to introduce scope to the 0.7778/0.7850 2016 highs and the 38.2% retracement, But this is now an increased probability." Meanwhile, tThe hourly FXStreet OB/OS Index is showing neutral conditions, alongside the FXStreet Trend Index which is slightly bullish.