- Iron ore prices have been falling in recent months but export volumes have been increasing with BHP Billiton announcing new record levels of production;
- Yesterday’s CPI data will keep the doves at bay but rate hikes are also very unlikely so interest rate stability for the next 6 months is the most likely outcome;
- Price action for the AUD against the EUR and NZD has felt quite bullish over the last few sessions but I’m wary of trying to jump on trends after months of momentum-less markets.
My long term view for AUD/USD remain very bullish but I don’t expect to break out of the .92/.96 range anytime soon.
Short-term prices should gravitate towards optionality at .9400 but be careful on the topside as there will be heavy option-related stops at regular intervals (we will hear more re exact levels as they get closer).