AUD,NZD/FXWW News/Technical Analysis/Trade Ideas

AUD outlook: Mixed bag on crosses but AUD/USD set to recover

  • AUD/NZD continues to drift slowly lower and is targeting 1.1500, but that level should be tough to breach. Resistance is solid near 1.1750/75.
  • AUD/JPY is consolidating in a daily channel between 90.00/93.50 (see chart).
  • AUD/USD looks really oversold on the dailies but could consolidate .9050/.9350 whilst the market musters some momentum.
  • [NZD/JPY looks like a stand-out buy-on-big-dips play].

I think the combination of improving risk-sentiment, wavering USD-sentiment and an already very short market will ensure that AUD/USD rallies towards .9600 in coming weeks.

 

  1. Risk appetite just took a hit with Detroit declaring bankruptcy – muni holders would be feeling somewhat uncomfortable.

    Impact on FX market is not immediately apparent to me.

  2. There are hundreds of munis that could go same way James. USD/JPY still rising?? Logical FX markets!! Had chat with J Kalaf, he will join us next Thursday

  3. I was hoping he would (I mentioned the get together that was postponed and he seemed interested).

    Yes on the muni front – hundreds indeed. The whole house of cards isn’t that resilient (except for the fact that it still defies gravity! lol…)

    At USD$18 billion in defaults I guess it is really only just under a week of Fed’s balance sheet expansion…

  4. AUD/NZD may not want to rally in the very near future. In fact, it has been one of the easiest and most profitable pair for trading for the last 4 months: we just have to keep selling it.

    I made money selling the pair for 2/3 of the fall, but then I have fought against the trend and given back a great deal of profits.

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