So you're assuming? I'm confused same point twice, what point? AUD/USD has hit 0.77x about 8 times since April 2016. Once it went above 0.78x (May '16).
The only difference this time is RBA doesnt have ability to use interest rate to reduce. So yes it could be an uncontrollable free run up if US data keeps sucking.
If US raise rates again (Dec?) AU and US rates on parity so the positive swap positions aren't as appealing, I'd expect a lot to pull out at this time. This is inline with pundits who said they expect to see AU fall back first half of 2018. Question is how high will this run last? You know all the people smarter then us know all this so are they going to want to hold long AUD positions?
COT still has most commercial traders short.
The only difference this time is RBA doesnt have ability to use interest rate to reduce. So yes it could be an uncontrollable free run up if US data keeps sucking.
If US raise rates again (Dec?) AU and US rates on parity so the positive swap positions aren't as appealing, I'd expect a lot to pull out at this time. This is inline with pundits who said they expect to see AU fall back first half of 2018. Question is how high will this run last? You know all the people smarter then us know all this so are they going to want to hold long AUD positions?
COT still has most commercial traders short.
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