Relatively soon after my last post, Australian employment data for April was released. No major surprises, but report was interpreted as positive. Economy Down Under created 33.7K jobs in April, which was more than the 20K expected. Good news was balanced by somewhat disappointing unemployment figures, which stayed at seasonally adjusted 5.4% for April. Consensus called for slight improvement to 5.3%. Part time jobs declined by 3,900, with an assumption that these positions were converted to full time.

Unlike other recent labor data releases, this one didn’t create very sharp moves in AUD. Sure, currency advanced, but in a much more measured and steady fashion. Or perhaps it only felt like it, because of increased volatility over last week. At any rate Australian Dollar did get stronger and continued this trend until London opening. Given my attention to AUD-JPY this week, I was very much interested in outcome of the announcement and really liked gentle market response. It allowed to enter a long trade, which I wouldn’t have done had markets gone wild. Chart in last post indicated where my intended entry was placed.

Trade was initiated at 83.70. I was using 15M chart, so objective turned out to be small, 30 pips only. It was reached in few hours and market proceeded even higher. Things turned rapidly after London open. At first, it looked like a pull back, but after some time it became clear that possible reversal is taking place. Most currency pairs reacted sharply. Went short, but since trade was late, my target also had to be on a smaller side, 50 pips, before price touched 100 SMA. Even though it wasn’t the best of trades, I’m not complaining. Just now, price reached previous low at 82.75, but I’m not selling it here yet. Want to see a reaction first, establishment of another support point.

With one trading day left this week, I’m going to stay with AUD-JPY on these pages. Price is still contained within large range, which was formed this week. Inside this zone is a series of minor highs/lows one could use for order placement. Sell order outside of this congestion area, at 81.97, but if price reaches it very late in trading day, it will be cancelled. I’m more focused on smaller target trades. Right now, it would nice to see price find support at 82.75-80, before sell order is placed there. On the buy side, move above 83.80 might be a good place to go long. Let’s hope for busy Friday.

Mike K.