Yesterday I said: "Following Wednesday's decision by the FOMC, the risk trade is firmly off. This is a trend I fully expect to continue over the short- and medium-term, barring central bank intervention, although some pullbacks (brief rallies in AUD/USD) could occur. Going forward, I am short AUD/USD from the 0.9820 level, and I find that selling in the 0.9820-0.9850 area looks promising on rebounds. With a floor in place just below 0.9740, drops below this look to extend losses towards multi-month lows." My bias remains the same, despite the AUD/USD rebounding off of session lows ahead of the U.S. session open, but this should provide another opportunity to sell the rally. I will be closing my book going into the weekend, as the threat of monetary intervention on a coordinated level could cause significant moves against the risk-averse trade over the weekend.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.