The AUD/USD exchange rate exhibited some stabilization following the Supreme Court’s consideration of arguments regarding Donald Trump’s tariffs on Wednesday. The latest jobs report indicated a slight increase, reflecting stabilization in the labor market last month. The AUD/USD pair has been trading within a narrow range following the Supreme Court’s apparent skepticism regarding Donald Trump’s invocation of emergency powers to amass billions of dollars monthly through tariffs. According to Polymarket data, the probability of Trump winning the case has decreased to approximately 20% as the hearings progressed. Even in the event of a Trump defeat, he retains the ability to implement tariffs on significant nations such as China, as well as allies including Germany and Japan.
The AUD/USD pair responded to the recent ADP jobs report, indicating that hiring resumed in October following a loss of 32,000 jobs in the prior month. In October, it recorded an addition of over 42,000 jobs, surpassing the median estimate of 40,000. The report has garnered significant attention in recent weeks, as it represents the sole labor-related data available during the longest government shutdown in US history. The Federal Reserve’s recent statement indicates a significant softening in the labor market, which accounts for the interest rate cuts implemented in the last meeting.
The AUD/USD pair responded to the recent US services and composite PMI figures from the United States. A report by ISM indicated that the services PMI increased to 52.4 in October, up from the prior figure of 50. Another report from S&P indicated an increase to 54.8, up from the prior figure of 54.2. The pair will respond to remarks made by certain Fed officials, including Beth Hammack, John Williams, and Michael Barr.
The AUD/USD exchange rate has shown signs of stabilization following its decline to a low of 0.6463 on Wednesday. The asset’s stability was observed following its movement to a critical support level, aligning with the ascending trendline that links the lowest swings since May 12. An analysis reveals the formation of a head-and-shoulders pattern, a typical bearish reversal pattern, with its neckline represented by the ascending trendline. Consequently, the prevailing outlook for AUD/USD appears to be bearish, with the primary target set at the psychological threshold of 0.6400. A breach above the 100-day Exponential Moving Average at 0.6541 will negate the bearish perspective.