Australia saw another increase in employment which may very well keep the Reserve Bank of Australia (RBA) holding at its current policy, possibly through the rest of 2015.
Governor Glenn Stevens from the RBA continued to endorse a “wait and see” approach when it comes to policy decisions. He went on saying the RBA anticipates a sustainable recovery along with a further employment improvement.
The events have helped stabilize the Aussie recent fall since mid-August. Aussie bulls are suggesting the RBA could be looking at pulling back on its easing cycle allowing the Aussie to strengthen.
Technical indicators on the daily chart (AUD/USD) are in flux with the MACD approaching a bullish cross while RSI continues look strong and price has finally pushed above the T3 Tilson. Remember, when trading currencies technicals play a key role.
For a near term trade in the Aussie vs. Dollar (AUD/USD) I want to look at lower time frame chart. Looking at the 1hour chart we find a flag pattern has formed across the 7 hours snice the Employment number. A break (one full hour candle closed outside of the flag) in the flag typically suggest the direction in the near term and typically that break is a continuation of the trend. But in this case with such a strong long term downward trend against a very short term upward trend. I’m waiting for not just the close outside of the flag but as well the next candle closing outside of the flag for conformation.