After the soft employment data in April there was both hope and an expectation of an improvement in May's figures. These expectations were more than met as unemployment dropped from 6.2% to 6% and 42k jobs have been created.
South Australia continues to see the largest unemployment which has ticked up to 7.2% form 7.1%, with Tasmanian unemployment close behind at 7%. Australian Capital Territory and Northern Territory are enjoying the lowest unemployment of 4.2% and 4.5% respectively.
Price was resting precariously on the 77c level prior to the release but it wasted no time in spiking 70 pips at the arrival of the good news and above 0.775 resistance which now becomes likely support for the remainder of the session.
A break above 0.7818 confirms a Double Bottom but for now, my bias is for price to remain contained below this key level and for the AUD to carve out a Triangle formation. A decent print from US retail sales tonight should keep prices contained below this resistance level.
China Industrial Production and US Retail Sales up next
Next up is Chinese Industrial Production and US Retail sales which are likely to be key AUD drivers. With soft retail sales from US last month there are concerns regarding consumer spending and the impact on G2 GDP. However last year we saw a similar pattern where retail in April was soft before seeing it jump considerably higher in May, and could be a pattern we see again later tonight. This should see the Greenback regain strength and push AUD lower.