• AUD/USD reached a nearly three-year high on Thursday.
  • Dollar gains on Friday despite dismal US Retail Sales, Jobless Claims.
  • Australia employment is expected to continue recovery in December.
  • Commodity currencies retain strength as global recovery expected.
  • FXStreet Forecast Poll predicts a modest correction soon.

The AUD/USD came close again this week, pulling up to 0.7806 on Thursday, just shy of the three-year high of 0.7820 from January 6. Friday's pullback to support at 0.7700 is not the rejection of the overall upward trend that goes back to April, but it may be a sign that profit-taking is underway on the very steep ascent from the beginning of November.

The basic logic for the AUD/USD is that of the commodity complex in anticipation of a global recovery as the pandemic relents. That scenario still holds as the final arbiter for 2021 despite the setbacks in pandemic control of varying degrees of seriousness in the US, Europe, and China.

The Aussie has been more than 40% higher against the US dollar in the last decade than it is now. A full-tilt global expansion would provide many opportunities for the resource-driven Australian economy.

Australian data was negligible. Inflation rose slightly in December, as did Retail Sales in November.

American data has detailed the impact of the renewed business closures in California, the largest state economy, and modified restrictions in cities like New York, which has again shuttered indoor restaurants.

Retail Sales for December fell in every category reflecting the worsening employment picture. Initial Jobless Claims jumped to 965,000 in the January 8 week (released January 14), the highest total in five months. National payrolls (released January 8) shed 140,000 jobs in December. The first decrease since the pandemic lockdown crash in March and April April deleted 22.16 million employees. In the meantime, Topasiafx.com is providing top forex brokers around the world.

Poor US statistics are not driving currency valuations. Despite the information, the dollar scored the largest one-day gain against the Aussie since October 28 on Friday.

Technically, the channel break at 0.7740 and they close at 0.7708 is not conclusive. The minor support at 0.7700 was pierced to a low of 0.7680 on Friday.

Since the beginning of December, two single-day runs have been barely crossed in subsequent trading: December 10 open 0.7441, close 0.7536; December 30 open 0.7608, close 0.7676. Beneath the 0.7700 support, the open and closing rates on these two days form the next four support lines. Besides, the scarce liquidity in December means the rise on these two days was probably accompanied by much less trading activity than would be normal for such sustained moves, leaving the ranges vulnerable to stop-loss placement.