Back
10 Sep 2013
AUD/USD enters critical 0.9220/0.93, let the real battle begin!
FXstreet.com (Barcelona) - Last week, we discussed the change in market perception towards the RBA monetary policy stance, arguing how the market might be getting ahead of itself, with the potential ramifications being yet another failure by the AUD to rally past 0.93/0.9330, on the basis of more rate cuts should the value of the AUD reach a certain level.
The level stipulated as the line in the sand by the RBA, which is purely based on the assumption of the technical damage it may inflict on the AUD/USD, was a clean break through 0.93/0.9330. Today, as risk sentiment improved, the pair closed just above the key resistance area of 0.92/0.9220, a technical event hard to ignore as the next upside hurdle comes at the aforementioned 0.93.
According to Milan Cutkovic from FXWW: "AUD struggling slightly above 0.92, but remains well-bid on the dips; while overall sentiment remains negative, market positioning still at extreme levels; short-squeeze could extend." Technically speaking, Cutkovic notes supports at 0.9170 and larger at 0.9120 with stops through 0.9150.
At this point, should the case to put on your bearish disguise on the AUD be compelling enough, the rate is starting to hover around an area potentially filled with strong offers, as the risk reward makes the idea of selling an attractive proposition. However, the AUD/USD is not free from more bearish setbacks, and the solid bid tone into 0.9220 territory paired with potential disappointment next week when the Fed taper decision is made, argues for a cautious approach.
The level stipulated as the line in the sand by the RBA, which is purely based on the assumption of the technical damage it may inflict on the AUD/USD, was a clean break through 0.93/0.9330. Today, as risk sentiment improved, the pair closed just above the key resistance area of 0.92/0.9220, a technical event hard to ignore as the next upside hurdle comes at the aforementioned 0.93.
According to Milan Cutkovic from FXWW: "AUD struggling slightly above 0.92, but remains well-bid on the dips; while overall sentiment remains negative, market positioning still at extreme levels; short-squeeze could extend." Technically speaking, Cutkovic notes supports at 0.9170 and larger at 0.9120 with stops through 0.9150.
At this point, should the case to put on your bearish disguise on the AUD be compelling enough, the rate is starting to hover around an area potentially filled with strong offers, as the risk reward makes the idea of selling an attractive proposition. However, the AUD/USD is not free from more bearish setbacks, and the solid bid tone into 0.9220 territory paired with potential disappointment next week when the Fed taper decision is made, argues for a cautious approach.