ASX 200 Holds Gains as Jobs Data Fails to Derail Risk Rally
Strong jobs data lifted RBA hike odds, but ASX 200 futures held Wall Street-led gains as easing tariff risks kept risk appetite intact.
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Australia’s employment report delivered another solid set of figures, reinforcing market expectations of an RBA rate hike in February. While some strength reflects seasonal factors around the summer–Christmas period, the data were strong enough to push back against claims it was merely seasonal noise.
Unemployment fell 0.2 percentage points to a seven-month low of 4.1%. Importantly, the gains were not driven solely by temporary student employment, with 65.2k jobs added — including 54.8k full-time roles and 10.4k part-time positions. All key labour market indicators improved from the prior month.
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View related analysis:
- Australian Dollar Rallies as Trump Eases Tariff Fears, Wall Street Rebounds
- Gold Bid at Highs as Trump Forces Tariff Debate Onto Davos’ Sidelines
- ASX 200 Market Outlook: CBA Eyes 150 Break, RIO Signals Reversal Risk
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Source: Australian Bureau of Statistics (ABS), LSEG
The Australian dollar extended its rally, with AUD/USD rising for a fourth consecutive session and the Aussie strengthening against all FX majors for a second day. Bond yields edged higher alongside rising RBA hike odds, though the decisive test for a February move remains Wednesday’s quarterly inflation report. With Trump’s tariff threats receding, improved risk appetite has allowed markets to refocus on inflation-sensitive data such as employment.
ASX 200 Futures (SPI 200) Technical Analysis
The ASX futures market is on track for a bullish outside day, although most of the upside followed Trump’s comments on a possible Greenland “framework” with NATO. Australia’s strong jobs report actually coincided with the current daily high, with prices since easing modestly from those levels.
While expectations of an RBA hike continue to build, geopolitics appear to be the dominant driver for now. The shallow pullback in Australian equities suggests headline risk — rather than domestic data — is steering price action. That keeps the door open for the ASX to grind higher alongside Wall Street if Trump’s Greenland framework is seen as sufficient to remove tariff risk.
Importantly, the daily low in ASX futures held above rising trend support and the 8700 handle — key support level I highlighted yesterday. With daily RSI (14) trending higher alongside price and still well short of overbought territory, bulls may look to buy dips within today’s bullish engulfing range, targeting a move towards 8900.
While not shown on the chart, there is heavy call options interest clustered around the 8900 level in the ASX 200 cash market, which could act as a magnet if upside momentum persists.
Chart analysis by Matt Simpson - Source: ASX, TradingView
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-- Written by Matt Simpson
Follow Matt on Twitter @cLeverEdge
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