AUD/USD struggles near 0.6900 as DXY becomes volatile in advance of US NFP

During the Asian session, the AUD/USD pair is experiencing opposition around the immediate barrier of 0.6900. As the US dollar index (DXY) has become turbulent at the open, the asset is exhibiting erratic behavior close to the critical level of 0.69. After a steep surge to the upside from Monday's low near 0.6840, the asset is exhibiting sideways movement within a 0.6883 to 0.6926 range.

After a corrective move, it is anticipated that the DXY would decline further, as a comeback in risk-sensitive currencies indicates that further gains are possible. In addition, the gloomy outlook for US Nonfarm Payrolls (NFP) has an effect on the DXY.

According to the preliminary projections, the US NFP is anticipated to plummet to 285k from 528k previously reported. Additionally, the unemployment rate is anticipated to remain unchanged at 3.5%. Notable is the fact that the US economy has maintained a 3.5% unemployment rate for an extended period of time, thereby squeezing out space for more employment prospects. The process of job creation is increasing significantly but at a decreasing rate, which does not justify a decrease in labor data.

On the Australian front, market participants will focus on the Building Permits data, which is anticipated to decline by 2% vs 0.7% previously. A drop in economic data may have an effect on the Australian bulls. In addition, the antipodean is still suffering from the effects of Monday's Retail Sales report. The Australian Bureau of Statistics released optimistic Retail Sales information. The economic statistics came in at 1.3%, exceeding the average estimate of 0.3% and the previous report of 0.2%.