AUDUSD Rallies But Remains Technical Short
On May 9, MacroView issued a short idea on AUDUSD and highlighted the strong correlations with copper and gold, which we would see the trifecta fall 2.93 percent, 4.90 percent and 6.68 percent respectively.
We've seen all three etch out bottoms in early June, yet copper is retesting those lows on unexpected increases in inventories. The AUDUSD went big following the Reserve Bank of Australia holding their key benchmark to 1.75 percent. Unfortunately, this will be short-lived. The central bank's policy will strongly be tethered to the economic performance of China.
Technically, we see price resistance at .7520 with a breakout potential to .7645 since the move does have relative strength in momentum. However, the weekly technicals still show a picture of lackluster upside potential.
Intermediately, the z-score is at a very high 2.6 (+/- 2 are a great contrarian indicator).
Trade posted on chart. Updates will be provided.
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Also, readers are encouraged to post their thoughts and charts!
We've seen all three etch out bottoms in early June, yet copper is retesting those lows on unexpected increases in inventories. The AUDUSD went big following the Reserve Bank of Australia holding their key benchmark to 1.75 percent. Unfortunately, this will be short-lived. The central bank's policy will strongly be tethered to the economic performance of China.
Technically, we see price resistance at .7520 with a breakout potential to .7645 since the move does have relative strength in momentum. However, the weekly technicals still show a picture of lackluster upside potential.
Intermediately, the z-score is at a very high 2.6 (+/- 2 are a great contrarian indicator).
Trade posted on chart. Updates will be provided.
For more information on MacroView's products, or general questions and comments, feel free to message us.
Also, readers are encouraged to post their thoughts and charts!