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Initial Jobless Claims Miss, US Dollar Volatile - AUD/USD Sells Off

Christopher Vecchio

THE TAKEAWAY: USD Initial Jobless Claims (JUL 6) > 360K versus 340K expected, from 344K (revised higher from 343K) > USDOLLAR NEUTRAL

Jobs data out of the United States has come under increased scrutiny the past several months as Federal Reserve officials have made it abundantly clear that future policy will be decided by the health of the labor market. Accordingly, intramonth data such as the Initial Jobless Claims print has become an important data release for FX traders to monitor.

This week, however, the data is less significant as it comes from the July 6 reporting period, which encompassed the July 4 holiday. Furthermore, seasonal tendencies suggest that June/July claims data tends to be volatile given the influx of temporary workers entering the labor market. Accordingly, price is behaving as expected following the slightly disappointing data: the US Dollar sold off on the headline; then it rebounded as investors reconsidered the reliability of the data.

AUDUSD 1-minute Chart: July 11, 2013

Initial_Jobless_Claims_Miss_US_Dollar_Volatile_-_AUDUSD_Sells_Off_body_x0000_i1027.png, Initial Jobless Claims Miss, US Dollar Volatile - AUD/USD Sells Off

Charts Created using Marketscopeprepared by Christopher Vecchio

Following the announcement, the AUDUSD initially jumped higher from $0.9196 to as high as 0.9214, but soon faded and fell to 0.9172. At the time this report was written, the pair had traded back to 0.9183. Elsewhere, price action observed was similar, with the British Pound, the Euro, and the Japanese Yen all initially rallying, then fading gains against the US Dollar in the minutes after the data release.

--- Written by Christopher Vecchio, Currency Analyst

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