Aussie dollar sharply up on robust labor data and forming reversal pattern on daily chart

Australian dollar bounced around 1% in early Thursday, reversing more than a half of four-day 0.6894/0.6750 pullback and suggesting that correction from 0.6894 double-top of July 13/14, might be over.

Aussie dollar received strong support from robust Australian jobs data in June (employment grew more than a double of expectations and jobless rate remained unchanged despite forecasts for ticking higher) which signal that labor market remains tight and continues to fuel inflation.

Upbeat data impacted rate outlook, pushing higher percentage of bets for RBA’s 0.25% rate hike on Aug 1 policy meeting, as well as lifting projections of a terminal rate and subsequently lifted Australian dollar.

Fresh strength improved near-term structure, as bullish engulfing pattern is forming on daily chart (requires close above 0.6820 for confirmation) and expected to generate reversal signal.

Technical picture is overall bullish on daily chart (strong positive momentum / MA’s in bullish setup) contributing to positive signals, which will be verified on extension above cracked Fibo pivot at 0.6839 (61.8% of 0.6894/0.6750 bear-leg).

Res: 0.6839; 0.6860; 0.6877; 0.6894
Sup: 0.6805; 0.6784; 0.6764; 0.6750