AUD,NZD/Flows and Orders/FXWW News/Technical Analysis

AUD/USD still looking heavy

  • Asian real money sellers capped the pair on Friday near .8820;
  • Sentiment remains bearish as the market plays it as a ‘Chinese credit bubble’ proxy;
  • Technical target at .8570, a 50% retracement of the big rally from .6050.
  1. That despite the unemployment rate in Australia, even after the very bad report last week, is still lower than most of the world, GDP still slightly higher than many other countries, and the government still has a top credit rating, and the AUD is still dropping like a stone, has essentially made me give up on the whole “rational or efficient market theory” I learned back in university (okay, that’s not the only factor that determines prices, but still).

    Yes, things are worse than before for Australia because of the mining slowdown, but its still relatively well compared to elsewhere. Should the AUD have dropped? Yes. But to the extent it is still doing so? Seems like selling AUD has just become a fashionable trend and momentum driven, has nothing to do with the “rational market” which should more logically set things.

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