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Aussie Pairs

  • #2,081
  • Feb 27, 2008 7:55am Feb 27, 2008 7:55am
Quoting TIckerShuffl
I need AUDUSD to hit the skids, in a big way. I am looking for decrease in exports due to china protectionist trade practices leading to less reliance of imported food and coal.
Wait for Bernanke, he'll probably douse the Bull rally as he always does.
Patience + Humility + Study = Success
  • #2,082
  • Feb 27, 2008 7:57am Feb 27, 2008 7:57am
Quoting DutchTrader
Wait for Bernanke, he'll probably douse the Bull rally as he always does.
People are talking that inflation may halt rate cuts for a while.

Dutch, in that scenerio, what do you see getting hit harder EURUSD or AUDUSD?? Just curious for an outside opinion.
  • #2,083
  • Feb 27, 2008 8:04am Feb 27, 2008 8:04am
Quoting TIckerShuffl
People are talking that inflation may halt rate cuts for a while.

Dutch, in that scenerio, what do you see getting hit harder EURUSD or AUDUSD?? Just curious for an outside opinion.
I'm no insider, but I'd say both will take their lumps. When you start hearing "all time highs" or "multi year highs" anything can happen.
Patience + Humility + Study = Success
  • #2,084
  • Feb 27, 2008 9:12am Feb 27, 2008 9:12am
Quoting DutchTrader
I'm no insider, but I'd say both will take their lumps. When you start hearing "all time highs" or "multi year highs" anything can happen.
I hear ya...just closed a EURAUD long for a few pips, now sitting back trying to figure out a strategy going forward.

Waiting sounds like a good idea, hehe.
  • #2,085
  • Feb 27, 2008 7:58pm Feb 27, 2008 7:58pm
Aussie needs to take a breather, for sure... gold seems to be slowing down a bit. And perhaps people are pricing in another rate hike next week? Seems unlikely to me.
  • #2,086
  • Feb 27, 2008 8:56pm Feb 27, 2008 8:56pm
If you get .99 you're paying retail on the exhange. Most cases even through a credit card or bank transfer you'll get .95-.96 right now, at most.

Head on over to rba.gov.au and check out all the stats.

Australia's Current account deficit quarter after quarter continues to rise even in the midst of a higher AUD.

Australia's non-govt foreign borrowings continue to rise, faster and faster.

australia has just gone through an unprecendented housing boom boosting state govt surpluses, and allowing australians to use their house equity like an ATM.

All this looks suspiciously like the US over the last few years- now go back and look at historical data and we tend to follow the US alebit a few months to a year behind them.

And then....

Govt surpluses are due yes to the increase in commodities but also due to the booming housing market and retail activity.

Australia has high inflation and high interest rates

Sure the value of commodities are increasing and yes we have a good client in China - the sales made here are not fast enough to keep up with Expenditure. And China is looking towards Africa, Russia and other areas to source commodities, they dont really want to keep paying premium and Australia cant get it out of the ground fast enough which causes prices to rise. To match consumption and expenditure Australia would have to double the commodity sales and to do that would require a hefty infrastructure investment. But then again a lot of the resource companies have foreign ownership from foreign hedge and pension funds so a lot of the profits end up out of Australia.

Then on top of all that The US turns over trillions upon trillions of dollars each year and can raise far more taxes from it's economy and leverage against all their debts much faster than Australia or most other countries could dream of.

Collectively US Corporations still outrank all other nation corporations around the world in terms of revenue, profits, R&D expenditure, brand value and so on.

All the AUD activity is just shot term speculators and carry trades - check out Aug last year when the AU dropped 12 cents in a matter of days, That was an unwind of carry trades. If there is one bit of bad news or tightening of money around the world you can expect this to happen again. Australia is just an easy play for FX traders right now.

Quoting TheTopBloke
Where did you get this data? Sounds like you're talking about the US, not Australia.

http://www.forexfactory.com/showthread.php?t=69167

I'm sick of retyping it. If there is something that is incorrect or you have more accurate data, please let me know.

BTW, try wiring $10k from IOUSA to Australia. Last quoted was .99 less than 24 hours ago.

Go figure.
  • #2,087
  • Feb 27, 2008 9:32pm Feb 27, 2008 9:32pm
Great post mchael. It's always interesting to hear about the broader Aussie fundamentals, especially from an Australian.
  • #2,088
  • Edited 10:58pm Feb 27, 2008 10:19pm | Edited 10:58pm
Quoting mchael
If you get .99 you're paying retail on the exhange. Most cases even through a credit card or bank transfer you'll get .95-.96 right now, at most.

Head on over to rba.gov.au and check out all the stats.

Australia's Current account deficit quarter after quarter continues to rise even in the midst of a higher AUD.

Australia's non-govt foreign borrowings continue to rise, faster and faster.

australia has just gone through an unprecendented housing boom boosting state govt surpluses, and allowing australians to use their house equity like an ATM.

All this looks suspiciously like the US over the last few years- now go back and look at historical data and we tend to follow the US alebit a few months to a year behind them.

And then....

Govt surpluses are due yes to the increase in commodities but also due to the booming housing market and retail activity.

Australia has high inflation and high interest rates

Sure the value of commodities are increasing and yes we have a good client in China - the sales made here are not fast enough to keep up with Expenditure. And China is looking towards Africa, Russia and other areas to source commodities, they dont really want to keep paying premium and Australia cant get it out of the ground fast enough which causes prices to rise. To match consumption and expenditure Australia would have to double the commodity sales and to do that would require a hefty infrastructure investment. But then again a lot of the resource companies have foreign ownership from foreign hedge and pension funds so a lot of the profits end up out of Australia.

Then on top of all that The US turns over trillions upon trillions of dollars each year and can raise far more taxes from it's economy and leverage against all their debts much faster than Australia or most other countries could dream of.

Collectively US Corporations still outrank all other nation corporations around the world in terms of revenue, profits, R&D expenditure, brand value and so on.

All the AUD activity is just shot term speculators and carry trades - check out Aug last year when the AU dropped 12 cents in a matter of days, That was an unwind of carry trades. If there is one bit of bad news or tightening of money around the world you can expect this to happen again. Australia is just an easy play for FX traders right now.

Thing is, Aud pairs do depend on fundamentals, but mostly via the stock markets (indirectly).
  • #2,089
  • Feb 27, 2008 10:56pm Feb 27, 2008 10:56pm
Quoting scexglobal
Thing is, Aud pairs are do depend on fundamentals, but mostly via the stock markets (indirectly).
Yes that is right - I was checking the AUD in comparison to the DJ/S&P whilst playing with the new Yahoo finance charts:


Compare AU/DJ/S&P

the AUD seems to trend along with them but at the moment is breaking away.
Could postulate that if the DJ/S&P trned upwards the AUD will continue up.. but if the DJI/S&P starts downward then so will the AU. Either way I think we are almost at the top of the Au and AUD boom and later this year will be a trend downwards for a while. So at some point this year will be the time to "stock" up on US dollars just before it stabilizes and starts it's upward correction.

Essentially there are two discussions going on here - one about short term trading and one about long term economic fundamentals and impact.

The next few months will be interesting as there is a lot to play out. I am also keen to see what happens when Japan's financial year ends and what data comes out of it.
  • #2,090
  • Feb 28, 2008 3:35am Feb 28, 2008 3:35am
The housing market in Australia is not the same as in the US. Given time, I'm sure there would have been plenty of lending at 125%, but it never happened in Australia.

As far as I know we aren't seeing dramatic delinquincy rates on credit cards.

The debt you refer to is investment coming into the country.
  • #2,091
  • Feb 28, 2008 7:08am Feb 28, 2008 7:08am
It's getting rediculous.
  • #2,092
  • Feb 28, 2008 7:23am Feb 28, 2008 7:23am
Quoting TIckerShuffl
It's getting rediculous.
I don't see it ending before it reaches 9500, just my .02
Patience + Humility + Study = Success
  • #2,093
  • Feb 28, 2008 7:50am Feb 28, 2008 7:50am
My instinct tells me to stay away until the markets settle down into these new valuations. With all the uncertainty, it's hard to make any solid forecasts. I'll keep an eye out for continued scalp opportunities, but seems like in current ranges, lots of froth and not much else.

Granted if you were on the right side of the sweeping moves against the dollar, you are happy and feeling like a genius, but I have employed a new strategy with smaller positions, and concrete SL, Buy stops and TP, so been basically flat for 2 weeks.

I see some stabilization and opportunity, but while doing a little paper trading this AM (besides my profitable EURAUD long), I watched for example a GBPUSD long go up 20 pips and give it all back in less than 30 mins. Got to be nimble in these markets it seems. Take any pips you can.

Good luck.
  • #2,094
  • Feb 28, 2008 12:03pm Feb 28, 2008 12:03pm
close bro...

9495.. i hope it doesnt have enough steam to go upwards..
Quoting DutchTrader
I don't see it ending before it reaches 9500, just my .02
  • #2,095
  • Feb 28, 2008 12:54pm Feb 28, 2008 12:54pm
I'm surprized that AUD has kept rising despite the Yen dropping to test 105. All other times the AUD has retraced and allowed good entries but not this time.
Seems much of the AJ carry trades have now been set on AUDUSD.

Agree a pull back is due, but remember when it broke 80 it ran to 84 quick smart.
  • #2,096
  • Feb 28, 2008 1:59pm Feb 28, 2008 1:59pm
I am negating my previous call of 1.0 for the short term. Actually, I see it reversing from 0.9500 in a steep corrective wave, wave 4 down. I will short with a tight risk.

A fib projection reached, psychological and barrier. Should be wave 3 end, let us see

Only my opinion.
  • #2,097
  • Feb 28, 2008 2:15pm Feb 28, 2008 2:15pm
im with you on a steep corrective wave...

that's what i have been hoping for..

im at least looking @ 0.90 as a target.

Quoting CounterTrend
I am negating my previous call of 1.0 for the short term. Actually, I see it reversing from 0.9500 in a steep corrective wave, wave 4 down. I will short with a tight risk.

A fib projection reached, psychological and barrier. Should be wave 3 end, let us see

Only my opinion.
  • #2,098
  • Feb 28, 2008 2:19pm Feb 28, 2008 2:19pm
I do not know the target yet, I will calculate after this day close.. and after I see reaction to 0.9500 there is odds that a top is in place, but i am waiting visual confirmation. It's overbought as well, and there is divergence on charts.
  • #2,099
  • Feb 28, 2008 2:38pm Feb 28, 2008 2:38pm
I sold here .9489

Higher short than I expected. No stop will just average up I guess for now. Very small position.
  • #2,100
  • Feb 28, 2008 3:08pm Feb 28, 2008 3:08pm
Good strategy, you can use it against a corrective rally in usd.
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