What's Next for Aussie?
SHORTING THE AUSSIE AFTER 3 STRAIGHT down weeks may be a risk for such a high yielding currency, but the latest 25-bp rate hike to 4.50%, was accompanied by a neutral policy statement in which RBA governor Stevens said: rates for most borrowers will be around average levels compared to the April statement when he said: Interest rates to most borrowers nonetheless have been somewhat lower than average... it is appropriate for interest rates to be closer to average. Todays rate hike sent the message that the RBA could pause, especially considering further tightening in China as well as the potential for further deterioration in Eurozone sovereign debt. While this does not necessarily mean the RBA is done for the year, a pause into the next 3 months would be sufficient to pare longs from AUD. AUDUSD is now to 0.9080, a break of which would test the next key support at 0.8980. Weeklies suggest 0.89 can be attained later this month in the event of further risk dislocation from US bank stocks. TODAY's 130-pt damage may well be followed by recovery towards 0.9220, but medium term players must also be protected against any 0.9280 trend line resistance. Shorting AUDJPY may also be an option, but care must be exercised in the event of continued US data surprises, which could drag down JPY.
May 17, 2017 17:59 | by Ashraf LaidiThe matrix below highlights the 12 trades in EURUSD issued by the Premium Insights since December 2015.
Apr 20, 2017 13:08 | by Ashraf LaidiWe may have started to sound like a broken record with our repeated stance in favour of silver over gold over the last 6-9 months, via our numerous bearish takes on the gold/silver ratio.
Mar 10, 2017 19:58 | by Ashraf LaidiWe know that bond yields and oil generally move in the same, but sometimes the relationship breaks down as it did in last Nov-Dec due to powerful USD rally surging with yields to the extent that...