Making Progress; Labour Data Eyed

The greenback continued to soften on Wednesday as demand for safe havens waned after strong earnings from financial companies. Oil and metals rose which helped support the bid in AUD/USD, the pair was pushed higher throughout the day, hitting resistance at 0.7738, the pair closed near the top of its range around 0.7728, currently trading unchanged.

• From a technical perspective AUD/USD traded notably firmer Wednesday, taking out key resistance at 0.7677. This reverses the previously bearish outlook and opens a sharper correction higher toward the Mar 23 highs of 0.7750 and reversal trigger of 0.7849 further out. For any recovery to gain momentum, bulls need to build a base above the 0.7718 50-dma, which now undercuts as key support.
• Market participants look ahead to March labour market data, the figures due at 0230BST/1130AEST. CBA says: "We expect today's Australian labour force data for March will likely surprise on the upside and give AUD another boost. The consensus has generally underestimated the rebound in the Australian labour market since June."
• As highlighted by own analysts the labour market recovery has outstripped the baseline expectations at the RBA in recent months. The March release shouldn't reflect any impact from the cessation of the JobKeeper scheme, but the cessation does introduce some 2-way risk to the report in the coming months (although this is expected to be relatively negligible in terms of the bigger picture, given the aforementioned strong recovery in the space).