AUD/NZD enroute to 38.2% fibo target in 1.0560s following Aussie jobs blockbuster

• AUD/NZD bulls have been thrown a major life-line today on a very solid jobs data, significantly in the full-time jobs sector which has sent the Aussie flying towards the 1.05 handle vs the NZD. 
• AUD/NZD is currently trading at 1.0480 from a low of 1.0435, having traded at 1.0488 and leaves the long term support line intact. 

AUD/NZD has been treading on thin ice of late, technically speaking. The cross has withstood a series of downbeat economic data and dovish rhetoric but on the Aussie jobs data, the mood will shurely shift in favour of a prolonged upside recovery.

The data arrived as follows: 

• Employment Change: +39.1 K vs the expected 15.0K, prior 21.6K - (Revised 16.9k)
• Unemployment Rate: 5.0% vs the expected 5.0%, prior 5.0%.
• Full-Time Employment Change: 65.4K which is a very strong result while the prior was -3K - (Revised  -9.5k)
• Part Time Employment Change: -26.3K while the prior was 24.6K - (Revised 26.4 k)
• Participation Rate: 65.7% vs the expected 65.6%, prior was 65.6%.

Elsewhere, from events overnight, the FOMC minutes were revealed. Analysts at TD Securities summed them up as follows: 

• The FOMC Minutes revealed uncertainty was the key factor in the Fed's dovish shift, rather than a materially weaker outlook. However, low inflation was bumped up in the list of worries and sparked a debate about additional hikes.
• Conversely, the balance sheet discussion was more dovish for markets. "Almost all" participants in January thought the Fed should, "before too long," announce a plan to stop runoff "later this year." Our base case has been for a June end to runoff, given the stated desire to maintain a buffer on excess reserves.
• Both linear and nonlinear rates market reacted tamely as, relative to market expectations, the minutes were modestly less dovish on the rate front but more dovish on the balance sheet front.
• The mostly dovish signal on the balance sheet should keep the USD on the back foot. It lends further support to global reach-for-yield and should also reinforce topside resistance in the DXY. Fed speak has mostly telegraphed this shift, leading to some modest retracement in the FX market on the release, but nothing here should arrest the recent pullback in the buck.

AUD/NZD levels

AUD/NZD has so far managed to hold the key horizontal support line est. since June 2017, tested again 13th Feb 2019, despite a series of downbeat data and dovish rhetoric from the Aussie economy and the RBA. However, this data today will now leave that line in the sand in the rearview mirror and the cross can extend its correction towards an upside target that is located at the 38.2% fibo target in the 1.0560s.