AUD/USD extends rebound toward 0.7300 ahead of US jobs report
- AUD/USD is staging a rebound after closing the last three days in the red.
- US Dollar Index posts small daily losses below 93.00.
- Focus shifts to August Nonfarm Payrolls report from US.
The AUD/USD closed the third straight day in the negative territory on Thursday and spent the Asian trading hours in a tight range near 0.7270. Ahead of the American session, however, the pair staged a modest rebound and touched a daily high of 0.7297. As of writing, AUD/USD was up 0.21% on the day at 0.7288.
In the absence of significant fundamental drivers, the recent recovery seems to be a technical reaction to the three-day-long decline. Furthermore, investors seem to be opting out to remain on the sidelines while waiting for key macroeconomic data releases from the US.
Focus shifts to US jobs report
The US Bureau of Labor Statistics will release its closely-watched Nonfarm Payrolls (NFP) report at 1230 GMT. Investors expect employment in the nonfarm sector to increase by 1.4 million and see the Unemployment Rate dropping below 10%.
Earlier in the week, the USD reacted positively to the better-than-expected US data and we could see a similar reaction if the NFP reading surpasses analysts' estimate. Ahead of the data, the US Dollar Index is staying relative quiet below 93.00.
Previewing the NFP data and its potential impact on the greenback, "despite the five-week decline in the dollar, the market appears to be reassessing the state of the US economy and responding to statistical improvements," noted FXStreet analyst Joseph Trevisani. "The dollar has not reversed but it may have reached its negative limit on current US conditions. From here it follows the course of the American economy."
Technical levels to watch for