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AUD/USD recovers from 6-month lows, steadies above 0.75

  • AUD/USD finds support near 0.75 handle.
  • DXY fails to extend gains above 94.
  • AUD/USD looks to close the second straight week lower.

The AUD/USD pair, which dropped to its lowest level since early June at 0.7502, staged a modest recovery in the early NA session after the greenback came under pressure amid disappointing wage inflation figures. After edging higher to 0.7533, the pair failed to preserve its bullish momentum and was last seen trading at 0.7520, adding 0.13% on the day.

The U.S. Bureau of Labor Statistics published its closely watched employment report on Friday, in which it showed that the total nonfarm payroll employment increased by 228,000 in November, and the unemployment rate was unchanged at 4.1%. Although these figures were relatively upbeat, the wage inflation measured by the average hourly earnings failed to meet the market expectations of 2.7% as it came in 2.5% on a yearly basis. After spiking up to 94.07, the US Dollar Index reversed course and was at 93.89, up 0.15%, as of writing.

Despite this recent recovery attempt, however, the pair remains on track to close the second week in a row lower. Earlier this week, the RBA's cautious tone in its monetary policy statement failed to wake the AUD bulls up and the greenback strength throughout the week weighed on the pair.

Technical outlook

0.7500 (psychological level/daily low/6-month low) is a critical support for the pair. A daily close below that level could open the door for further losses toward 0.7455 (Jun. 6 low) and 0.7370 (Jun. 1 low). On the upside, resistances align at 0.7580 (20-DMA), 0.7670 (50-DMA) and 0.7710 (200-DMA). 

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