What's Next for Aussie?

by Ashraf Laidi
May 4, 2010 14:02 | 347 Comments

What's Next for Aussie? - Audhotchartmay4 (Chart 1)

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.

 

More Hot-Charts

  • More Downside in Equities from here Chart

    More Downside in Equities from here

    Oct 10, 2014 20:37 | by Ashraf Laidi
    DAX-30 .
  • Surging UK CDS ahead of Scottish Referendum Chart

    Surging UK CDS ahead of Scottish Referendum

    Sep 16, 2014 13:17 | by Ashraf Laidi
    UK CDS continue gaining following the biggest weekly increase in over 2 years. The 5-yr CDS is testing its 200-DMA for the first time since June2013.
  • World Cup & Market Patterns

    Jun 12, 2014 16:42 | by Ashraf Laidi
    9 of the last 13 World Cup tournaments elapsed during a period of falling stocks, with an average decline of 6% from the first to the final match. But see what happens in post-WorldCup Octobers.
Hot-Chart Archives
Comments (Showing latest 10 of 347) View All Comments
Ashraf Laidi
London, UK
Posts: 0
4 years ago
Feb 14, 2011 17:54
Said, Can i remind you again to post your comments in this forum according to the topic designed for the relevant topic? As much as I appreciate your continued input, I ask you to respect the organisational structure as the rest of participants have been doing.


Ashraf
sydneyjames
Sydney, Australia
Posts: 348
4 years ago
Feb 14, 2011 4:57
aussie rebound capped at around 1.0050 to 1.0070
usikpa
Moscow, Russia
Posts: 77
4 years ago
Feb 12, 2011 6:44
Just a correction?
http://www.businessspectator.com.au/bs.nsf/Article/bonds-interest-rates-Australia-dollar-economy-pd20110211-DY4B9?opendocument&src=rss

...
Long term interest rates are heading inexorably higher and the Australian dollar is coming down, according to one of the worlds leading market analysts, Charles Nenner, head of research at the Charles Nenner Research Centre in Amsterdam ...

... His first target is for the 10-year bond yield to climb to 4.3 per cent (from 3.7 per cent at present) while the yield on 30-year bonds will move to around 5.2 per cent (from its current level of 4.77 per cent).

At that point, he predicts the bond market will rally, with bond prices rising while yields drop back, because of fears over weakness in the US economy. After this rally, he predicts bond prices will fall, and bond yields will again push higher...

sydneyjames
Sydney, Australia
Posts: 348
4 years ago
Feb 10, 2011 11:21
aussie short is working quite well, pretty good risk / reward ratio trade. now it will b capped at former support level at around 1.0070 to 1.0100
chloethebull
Posted Anonymously
4 years ago
Feb 10, 2011 2:57
looks like aussie might be moving lower after jobs# which was mostly part time jobs an full time stalling out..plus we had the consumer inflation# which was weaker..could that be a sign of no rate hike coming?cad playing strong..plus oil/gold ration over 15.5 plus usdx has been trading over 78 recently plus we got dow tryn to to rxtend its winning streak ..not sure if it can wasnt it the s&p a few weeks ago that failed to extend its winning streak on a fri??? lots of volitilty in the next 10hrs gonna be a late night full of coffee and ???;)
sydneyjames
Sydney, Australia
Posts: 348
4 years ago
Feb 9, 2011 14:32
this is just the start of aussie dropping, now aussie is capped at 1.0130 to 1.0170, which is 100 day moving averags and also 61% retracement
catnip
Germany
Posted Anonymously
4 years ago
Feb 8, 2011 14:05
In terms of interest aussie short long term is a bad idea no doubt. However it could be one misses a big thing. I do not believe in the China miracle. Imo China is the biggest credit bubble.
Gunjack
London, UK
Posts: 1184
4 years ago
Feb 8, 2011 13:46
AUDUSD shorts med-long term not a bad idea. The recent natural disasters will thump the aussie economy and that effect will be felt in the coming quarters. Problem is USD is being de-based by FED and is also losing it's risk off status. Maybe AUDJPY better option?
Callum
Singapore
Posted Anonymously
4 years ago
Feb 8, 2011 13:41
Today's response was no different to the last hike, we saw a small blip before resuming to the highs. Unless we see SPX crash, AUDUSD shorts are worst to CARRY due to interest rate differentials.
catnip
Germany
Posted Anonymously
4 years ago
Feb 8, 2011 12:29
rose is aussie master trader... but I am long term short aususd anyway because I still figure a China crackdown trade is -100 pips from b/e