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Aussie traders are in for a busy week as Australia prints top-tier and closely watched data while China releases a data dump.

Which potential catalysts should you focus on?

Let me help you out:

Labor market data (Jan 21, 12:30 am GMT)

  • An improvement in Victoria’s labor market saw the country’s jobs increase by a net of 90,000 against expectations of a 50,000 uptick
  • Jobless rate inched lower from 7.0% to 6.8% while the labor force participation rate climbed from 65.8% to 66.1%
  • There were no other catalysts at the time so Aussie traders priced in (as in bought AUD) at the upside surprises
  • Markets see another 40,000 net job additions in January
  • Unemployment rate could inch back up to 7.0% while participation rate is seen improving to 66.2%

Lowe-tier releases

  • MI inflation expectations (Jan 21, 12:00 am GMT) to inch lower from 3.5% to 3.4%
  • Markit’s manufacturing PMI (Jan 21, 10:00 pm GMT) could dip from 55.7 to 55.1
  • Markit’s services PMI seen weakening from 57.0 to 56.5
  • Retail sales (Jan 22, 12:30 am GMT) could drop by 3.0% after a 7.0% jump in October

China’s data dump (Jan 18, 2:00 am GMT)

  • Quarterly GDP could speed up from 2.7% to 3.0% in Q4 2020
  • Fixed asset investment (ytd/y) to improve from 2.6% to 3.2%
  • Annual industrial production seen at 7.1% after 7.0% growth
  • Annual retail sales could rise by 5.1% after a 5.0% increase in November
  • Unemployment rate to remain at 5.2% in December

Overall risk appetite

  • Policy decisions from the Bank of Canada (BOC), Bank of Japan (BOJ), and the European Central Bank (ECB) will give clues on global monetary stimulus trends
  • Manufacturing PMIs from the U.S., U.K., Eurozone, and Japan will paint a picture of the recovery of global manufacturing
  • COVID-19 updates (number of cases, vaccine schedule, lockdown prospects) will continue to affect the demand for high-yielding currencies like the Aussie
  • Australia’s trade conflict with China can influence iron ore prices – one of Australia’s major exports – and affect AUD’s intraweek trends

Technical snapshot

  • AUD is hitting “overbought” levels on the daily Keltner Channels
  • AUD may soon hit overbought conditions against EUR, CHF, and CAD on the daily time frame
AUD Forex Pairs Keltner Channel from MarketMilk
AUD Forex Pairs Keltner Channel from MarketMilk
  • EMAs show the low-key bearish pressure AUD is receiving against most of its major counterparts
  • The Aussie remains on short and long-term bullish trends against the euro and Kiwi
AUD Forex Pairs EMAs from MarketMilk
AUD Forex Pairs EMAs from MarketMilk
  • The Aussie saw the most volatility against the safe-havens and the euro in the last seven days
AUD Forex Pairs Volatility from MarketMilk
AUD Forex Pairs Volatility from MarketMilk

Missed last week’s price action? Read AUD’s price recap for Jan. 11 – 15!