• AUD/USD strengthened on Monday as the U.S. dollar slid following a softer-than-expected jobs report.
• U.S. nonfarm payrolls data released on Friday came in significantly below expectations, reinforcing market speculation that the Federal Reserve will cut interest rates in September.
• The jobs miss is being interpreted as a signal that the labor market is losing momentum, adding to the case for policy easing.
• The Fed now faces a complicated policy landscape. While weak jobs growth calls for rate cuts, the newly imposed tariffs are starting to feed into inflation, creating a conflict between growth and price stability objectives. This could make decision-making increasingly difficult for Fed policymakers in the months ahead.
• Looking ahead, markets will be watching for U.S. June factory orders on Tuesday for further signs of economic softness.
• Immediate resistance is located at 0.6527(SMA 20), any close above will push the pair towards 0.6611(23.6%fib)
• Support is seen at 0.6426(38.2%fib) and break below could take the pair towards 0.6408(Lower BB).
Recommendation: Good to buy around 0.6470 with stop loss of 0.6400 and target price of 0.6540
