AUD/USD: Another topside test favoured in early London
We’ve got to remember that overall market sentiment remains bearish on the AUD but also that positioning is heavily short. We saw the first resistance level get taken out at .9305 after the CPI data put an August rate cut in doubt and then the bears returned in force after the HSBC data, selling the AUD aggressively.
But where to now for the AUD? The China data was bad, its now history, and the market is still short! In addition to this, real-money buyers have returned and there is still less liklihood of a rate cut in August!
I really think the AUD goes higher, talking my position as always, but in this case the market reactions would seem to be supporting me.