Australian Dollar attracts some buyers on the mixed Australian employment data

• The Australian Dollar trades on a stronger note, bolstered by the mixed Australian employment data on Thursday.
• The number of employed people rose by 50.2K, while the Unemployment Rate ticks higher to 4.1%. 
• The emergence of some USD buying keeps a lid on any meaningful upside for the AUD/USD pair.

The Australian Dollar (AUD) strengthens during the early European session on Thursday. The uptick in AUD is supported by a relatively stronger domestic jobs report, which supports the case for another possible rate hike by the Reserve Bank of Australia (RBA). Apart from this, the underlying bullish sentiment surrounding the global equity markets benefits the risk-sensitive Aussie and assists the AUD/USD pair to register a modest recovery from the vicinity of a two-week low, around the 0.6715 region touched on Tuesday.

That said, rising economic headwinds in China, along with falling copper prices, hold back bulls from placing aggressive bets around the resources-linked Australian Dollar. The US Dollar (USD), on the other hand, gains some positive traction and reverses a part of the precious day's losses to a nearly four-month low. This further contributes to capping the AUD/USD pair, warranting some caution before confirming that the recent pullback from a multi-month peak has run its course. 

Daily Digest Market Movers: Australian Dollar bulls seem reluctant as modest USD strength offsets stronger jobs data

• The official data published by the Australian Bureau of Statistics (ABS) this Thursday showed that the Unemployment Rate rose to 4.1% in June as compared to expectations and the previous figure of 4.0%.
• A slight disappointment, however, was offset by an unexpected rise in the number of employed people, from 39.7K in May to 50.2K in June, well above consensus estimates pointing to a reading of 20.0K.
• The mixed data, however, does little to influence expectations about the Reserve Bank of Australia's next policy move, albeit provides a modest lift to the Australian Dollar and the AUD/USD pair.
• The US Dollar, on the other hand, attracts some buyers and reverses a part of the previous day's heavy losses to a nearly four-month trough, which keeps a lid on any meaningful gains for the major.
• Meanwhile, a September interest rate cut by the Federal Reserve is fully priced in and investors are betting on the possibility of two rate cuts by year-end, which should cap the upside for the USD. 

Technical Analysis: AUD/USD seems vulnerable amid the formation of bearish rising wedge on daily chart

From a technical perspective, the AUD/USD pair bounces off support marked by an upward-sloping trend line.  This, along with another ascending trend line, constitutes the formation of an ascending wedge – a pattern with a bearish tendency. Moreover, oscillators on the said daily chart have just started drifting in the negative territory and suggest that the attempted recovery runs the risk of fizzling out rather quickly. 

Hence, any subsequent move up is more likely to attract some sellers near the mid-0.6700s and remain capped. Some follow-through buying, however, has the potential to lift spot prices back towards the 0.6800 mark, or a multi-month peak touched last week. A sustained strength beyond the latter will negate the near-term negative outlook and pave the way for the resumption of the prior well-established uptrend.

On the flip side, the aforementioned trend-line support, currently pegged near the 0.6700 round figure, could act as immediate support. This is followed by the 50-day Simple Moving Average (SMA), around the 0.6665 region, which if broken decisively will be seen as a fresh trigger for bearish traders. The AUD/USD pair might then accelerate the fall towards the 100-day SMA support near the 0.6600 mark.