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Scope for AUD bear move to extend as specs long get stopped out - ANZ

FXStreet (Bali) - Daniel Been, FX Strategist at ANZ, reviews the latest price action on the Aussie, and what were the main factors impacting the bearish move in the currency.

Key Quotes

"Positioning has also added to the AUD acceleration in the move. Long speculative positioning in the AUD was at a 12 month high as of the last CFTC report, having steadily built up since April. This positioning would have been added at a spot rate in the AUD of 0.9250 at best."

"This provides scope for the AUD move to extend as these positions get stopped out, and given the fundamental outlook, short positions are potentially entered (to better match other USD crosses)."

"Technicals have also contributed to the fall. The break of 92.20 represented a very important level, and a weekly close below the 50 week moving average at about 91.80 will add to the bearish dynamics."

"This makes the reaction to the employment report in Australia this Thursday very important, as it can consolidate this close below previous support and open up downside towards our year-end target for the AUD of USD0.88. Either way, it is likely that 92.20 will now stand as solid resistance on any bounces and a new, lower range is going to be forged."

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