AUD/USD Monthly Opening Range Intact Ahead Of Australia Jobs Report

AUD/USD appears to be stuck in a defined range after taking out the April 2018 high (0.7813), but the correction from the monthly high (0.7820) may turn out to be an exhaustion in the bullish price action rather than a change in trend like the behavior seen in the second half of 2020.

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Image of DailyFX economic calendar for Australia

As a result, Australia’s Employment report may fuel the recent series of higher highs and lows in AUD/USD as the economy is projected to add 50.0K jobs in December, and a positive development may keep the Reserve Bank of Australia (RBA) on the sidelines at its first meeting for 2021 as the “Board does not expect to increase the cash rate for at least 3 years.”

It seems as though the RBA will rely on its current tools to support the Australian economy after announcing plans to purchase “$100 billion of government bonds of maturities of around 5 to 10 years over the next six months” in November, and it remains to be seen if Governor Philip Lowe and Co. will extend the quantitative easing (QE) program beyond the current deadline as “members agreed to keep the size of the bond purchase program under review.”

In turn, key market themes may continue to sway AUD/USD as the RBA acknowledges that “the improvement in risk sentiment has also been associated with a depreciation of the US dollar and an appreciation of the Australian dollar,” and the tilt in retail sentiment also may also persist as traders have been net-short the pair since November.

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Image of IG Client Sentiment for AUD/USD rate

The IG Client Sentiment Report shows 48.61% of traders are net-long AUD/USD, with the ratio of traders short to long-standing at 1.06 to 1. The number of traders net-long is 0.08% lower than yesterday and 17.32% higher from last week, while the number of traders net-short is 7.09% higher than yesterday and 2.43% higher from last week.

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