Focus On Labour Market Report; COVID Concerns Linger

After touching intraday lows of 0.7431 in the European morning AUD/USD finished the day higher, touching session highs of 0.7486, the pair last trading around these levels. The move higher was facilitated by a weaker greenback after FOMC Chair Powell delivered a more dovish than expected testimony to congress noting there was still a long way to go before tapering.

• On the coronavirus front ABC are reporting that there may be new restrictions for Victoria today, but not a lockdown. PM Morrison made a TV appearance earlier and said the federal government would provide support to Victoria as soon as needed. As a reminder the lockdown of greater Sydney was extended for two weeks' yesterday.
• From a technical perspective AUD/USD is consolidating and attention remains on a key near-term support. Price recently found resistance at 0.7599, Jul 6 high. The outlook is bearish and sights are on 0.7365, the bear channel base drawn off the Feb 25 high. The recent move lower maintains the price sequence of lower lows and lower highs and moving average studies remain in bear mode. Initial resistance is at 0.7534.
• Focus today will be on the labour market report, consensus is for the economy to have added 20k jobs after a bumper 115.2k jobs in May. CBA says: "We estimate another large lift in employment of 45,000 compared to the consensus estimate of 20,000. We note Australian employment has generally beaten consensus estimates in the past year. Nevertheless, we expect the impact on AUD of an above‑consensus print will be minimal because the data pre‑dates the Greater Sydney lockdown." Traders will also have an eye on the monthly Chinese data dump with participants looking out for confirmation of slower economic activity.