11 Jul 2013
Flash: AUD/USD rebounds viewed as selling opportunities – Westpac
FXstreet.com (New York) - The local data calendar is fairly quiet – on Friday we see May housing finance approvals, then June motor vehicle sales on Mon and May Westpac leading index on Wednesday. More attention should focus on what should be dovish RBA minutes on Tuesday, notes Sean Callow, a Global FX Strategist at Westpac.
Fresh record net short AUD positions on IMM confirmed there was plenty of fuel for a short covering rally, should it find a spark. According to Callow, “We didn’t expect Mr. Bernanke to ignite the Aussie but at least until his next appearance, AUD/USD should be more two-way. The domestic story remains a cap on AUD though, with the rise in unemployment adding to the case for an RBA cut in Aug and China slowdown fears likely to persist beyond the likely softer Q2 GDP data on Monday.”
Short covering could take AUD/USD to say 0.9350/0.9400 but we would view this as a selling opportunity ahead of any Fed ‘clarification’ and with RBA easing looming.
Fresh record net short AUD positions on IMM confirmed there was plenty of fuel for a short covering rally, should it find a spark. According to Callow, “We didn’t expect Mr. Bernanke to ignite the Aussie but at least until his next appearance, AUD/USD should be more two-way. The domestic story remains a cap on AUD though, with the rise in unemployment adding to the case for an RBA cut in Aug and China slowdown fears likely to persist beyond the likely softer Q2 GDP data on Monday.”
Short covering could take AUD/USD to say 0.9350/0.9400 but we would view this as a selling opportunity ahead of any Fed ‘clarification’ and with RBA easing looming.