Bearish view
- Sell the AUD/USD pair and set a take-profit at 0.6400.
- Add a stop-loss at 0.6600.
- Timeline: 1-2 days.
Bullish view
- Buy the USD/USD pair and set a take-profit at 0.6600.
- Add a stop-loss at 0.6400.
The AUD/USD exchange rate stabilized a bit after the Supreme Court listened to arguments for and against Donald Trump's tariffs on Wednesday. It also rose slightly after the latest ADP jobs report showed that the labor market stabilized last month.
Trump Tariffs Hearing and US Jobs Data
The AUD/USD pair remained in a tight range after the Supreme Court appeared skeptical of Donald Trump's use of emergency powers to collect billions of dollars a month using tariffs.
Polymarket data shows that the odds that Trump will win the case dropped to about 20% as the hearings continued. Still, even if Trump loses, he has options to still impose tariffs on key countries like China and allies like Germany and Japan.
The AUD/USD pair reacted to the latest ADP jobs report, which showed that hiring returned in October after the country lost 32,000 jobs in the previous month. It added over 42,000 jobs in October, higher than the median estimate of 40,000.
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The ADP report has been watched closely in the past few weeks because it is the only labor-related data now that the US is in the longest government shutdown ever.
In its recent statement, the Federal Reserve has maintained that the labor market had softened substantially, which explains why it slashed interest rates in the last meeting.
The AUD/USD pair also reacted to the latest US services and composite PMI numbers from the United States. A report by ISM showed that the services PMI rose to 52.4 in October from the previous 50. Another one by S&P showed that it rose to 54.8 from the previous 54.2.
The pair will react to statements by some Fed officials like Beth Hammack, John Williams, and Michael Barr.
AUD/USD Technical Analysis
The AUD/USD exchange rate has stabilized after it fell to a low of 0.6463 on Wednesday. Its stability came after it moved to a key support level, which coincided with the ascending trendline that connects the lowest swings since May 12.
A closer look shows that it has formed a head-and-shoulders pattern, which is a common bearish reversal pattern, whose neckline is the ascending trendline.
Therefore, the most likely AUD/USD forecast is bearish, with the initial target being the psychological level at 0.6400. A move above the 100-day Exponential Moving Average at 0.6541 will invalidate the bearish outlook.
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