Daily Observations: August 06, 2013
- Short AUDUSD (1/2) at net 0.9192, Stop at 0.9170, Target 1 at 0.9045, Target 2 at 0.8960, Target 3 at 0.8770, Target 4 at 0.8545
- Short AUDUSD (1/) from net 0.9192 at 0.8960 for +232-pips; full-size position gain of +116-pips
Typical Time Frame: 1-day to 1-week
The RBA cut its key interest rate by 25-bps as expected but the shift in rate expectations ahead of the print - from 91% to 106% (100% for 25-bps cut; 6% for 50-bps cut) - marked the peak in bearish sentiment for the Australian Dollar. But that doesn't mean the decline is over.
A look at price action today shows only meager gains by the Australian Dollar in the wake of the less dovish than expected policy meeting. If the Australian Dollar is to recover, now is the time - otherwise it is clear that the bearish implications of the global commodity supercycle ending and the slowdown of China are too great to overcome in the short-term.
This is a big week for the Australian Dollar.A fight for $0.9000 is on against the US Dollar.
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--- Written by Christopher Vecchio, Currency Analyst
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