AUD Trading Outlook
The Australian dollar (AUD) advanced to 1.0392 and advanced to 1.0301 versus the US dollar. The British pound (GBP) soared up a staggering 200-pips, from 1.5482 to 1.5682 against the greenback, as the pair recovers after the lower than expected a 2nd quarter GDP figure.
Australian Dollar (AUD) the AUD/USD reversed as aggressively from the start of Asia where support was found at 1.0180 after CPI came in slightly weaker than expected at 0.5% vs. 0.6% forecast Q/Q. The EUR/USD and subsequent US stock market rally helped extend the rebound into a full blown risk rally and we saw a move above 1.0300 and then on to fresh week highs above 1.0330. The outlook is mixed with the Eurozone crisis still capable of pulling the AUD lower but the commodity currency remains well supported on the dip.
Australian Dollar (AUD) continued to act as the risk currency of choice tracking stocks lower for a second day and losing ground even against the Euro with the potential for even bigger losses in the event of a market crash. The EUR/AUD and GBP/AUD has been a source of strength for the Aussie in recent weeks and if the market unwinds these trades the AUD/USD may collapse. Update Q2 CPI at 0.5% vs. 0.6% forecast Q/Q.
Australian Dollar (AUD) the AUD/USD was the risk currency in play yesterday down over 200 pips from Friday as stocks collapsed and traders who had bought into the Aussie rally last week where caught wrong-footed. The risk sensitive currency will track stocks and has a chance of collapsing in a major dislocation event such as Greece leaving the EU or Spanish Debt Run. The other big risk is Chinese data with HSBC PMI today and the China slowdown story has been growing in importance for the Aussie traders lately. Looking ahead, July HSBC Flash Chinese Manufacturing PMI previously at 48.2. Also RBA Governor Stevens Speaks in Asia today.
Australian Dollar (AUD) the AUD/USD uptrend was damaged on Friday with the market caught long and a reversal being seen back under 1.0400. The selling has intensified on Monday morning Asia with negative Chinese news over the weekend and the mounting Global stock market losses further undermining the Australian Dollar. The EUR/AUD fell to record lows near 1.1700 but some profit taking has been seen as the AUD is sold aggressively against the Yen and USD and this could spark a short covering rally on the EUR/AUD and GBP/AUD. UPDATE Q2 Australian PPI at 0.5% vs. 0.3% forecast.
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