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Aussie Pairs

  • #2,361
  • May 20, 2008 4:36pm May 20, 2008 4:36pm
Quoting Subdude
I think that in reality their hands are tied. Guess what happens to the housing market (and the rest of the economy) if the rates stay high for a long time?

I read the RBA minutes and my understanding is they won't be raising or lowering the rates for the foreseeable future. If anything, they seem to be easing their hawkish stance.
Bear in mind the average homeowner in Australia puts 10% down, doesn't get the ridiculous 125% loan to purchase, plus they are not unfamiliar with rates twice as high as they are currently.

Your argument makes perfect sense, but Australians don't make perfect sense. So there you have it.
  • #2,362
  • May 20, 2008 4:40pm May 20, 2008 4:40pm
Quoting Subdude
What I find really hard to believe is that there's virtually NO evidence of carry trade unwinding taking place, as one might expect when the Dow takes a triple digit plunge. Financial stocks are being pounded, and yet the high yielders like aussie and kiwi are still in the stratosphere... I wonder what will happen if there's another 150 point selloff in U.S. equities tomorrow. As for me, I'm gonna try and get out of my aussie short at a profit before the big euro news releases tonight - it seems the euro is poised to give up the recent gains.
That tells me the smart money is positioned for the long term. Guess where they are positioned.
  • #2,363
  • May 20, 2008 4:41pm May 20, 2008 4:41pm
Quoting Subdude
Not so fast.

While there's merit to this, remember that 20 mil is like 1% of the total population in China; clearly, this is not nearly as devastating to that country as it would be if it happened to Canada.
Bear in mind 20M people is also the ENTIRE population of Australia.
  • #2,364
  • May 20, 2008 5:10pm May 20, 2008 5:10pm
Quoting TheTopBloke
That tells me the smart money is positioned for the long term. Guess where they are positioned.
Who do you call "the smart money" - hedge funds? Overall, here's the positioning per ccy pair on Oanda (does that only include retail positions? I don't know):
http://fxtrade.oanda.com/tools/stati...n_ratios.shtml

As you can see, AU is pretty damn near 50% long/short ratio (meaning no clear bias).
  • #2,365
  • May 20, 2008 7:23pm May 20, 2008 7:23pm
Quoting TheTopBloke
Bear in mind 20M people is also the ENTIRE population of Australia.
This was actually my point - it's easier for China to absorb that kind of damage than for any other nation.
  • #2,366
  • May 20, 2008 8:01pm May 20, 2008 8:01pm
I would'nt get too excited. This is all a bubble waiting to burst. Even if it does touch parity for a bit, remeber it's a tiny gain from where it has already come - meaning it's money making power is spent.

Sure there is demand for commodities but the thing is every man and his dog speculator is getting in on the action and bidding prices up. 30%+ year on year rises is not sustainable.

Look for the ugly economic data out of Australia soon - it's starting to build and you've already being seeing it. 18% of Australi's exports are commodities - thats a small proprtion that has to hold the rest of the country up.

The RBA minutes are like a cranky old Grandpa saying I'm gonna whack you if you dont behave but really does'nt intend to do so - they know it would be the final kick in the guts and the whole thing would keel over. Look at NZ - they went to high too fast and the NZ economy will go into recession. yet the bubble making speculators keep the currency up - yet everyone is saying it is destined for a tumble.

Talk about irrational excuberence gone made. the final last kick is where the carry traders and margin calls get whacked by a quick tumble and it all falls apart - the money literally vanishes. We've seen this in the credit markets first, then the sharemarkets and then next will be forex markets and then finally commodities will come undone.

Take the profits and run. Every gambler comes undone when he just wants to make that 1-2 extra % gain and forgets he's already made a killing and then the dealer swipes and takes the lot.
  • #2,367
  • May 20, 2008 8:04pm May 20, 2008 8:04pm
I'm not sure the OANDA data provides an accurate reflection of 'smart money', nor do hedge funds. When I say smart moeny I refer to traders holding longer term positions than one day or even one week.

As for the 20M figure, assuming there was complete destruction and a complete rebuild, you're speaking relatively of rebuilding everyhome or apartment building housing the entire population of Australia.

So relative to China's population it's tiny, but relative to the building materials and energy required to produce results, it's massive.

Even in American terms, 20M as opposed to 300M is large, and seeing as Australia pumps out tons of coal, steel, iron, etc.. and delivers to China, the term of trade Australia has will again improve.

But that's just in theory of course. I'm not familiar with the details of what's going on over there.
  • #2,368
  • May 20, 2008 8:12pm May 20, 2008 8:12pm
Quoting mchael
Look for the ugly economic data out of Australia soon - it's starting to build and you've already being seeing it. 18% of Australi's exports are commodities - thats a small proprtion that has to hold the rest of the country up.
That's not correct. I know the commodities are something small like 8 - 12% of the Australian economy, however the commodities account for something like 46% of exports.

That's why the Australian homeowner is going to get fleeced by their banks interest rates while the commodities will continue to go up and up. There is still no data to suggest that the exports of commodities from Australia is going to slow down.

On the contrary, it appears to continue to improve, even as they jack prices by 200, 300, 400% in some cases. The Chinese would rather dump the dollars for the hard assets. Wouldn't you? Assuming you believe the USD was going to tank?

Also, look at any youtube.com discussion between Mr. Bernanke and Mr. Paul. They agree on everything, yet Bernanke will continue to pump money, for as someone put it perfectly, a synthetic growth. Smart money knows what happens when you produce money out of thin air.

You can always buy gold, silver, copper, other currencies today, and sell them back at a later date for a huge profit.
  • #2,369
  • May 20, 2008 8:46pm May 20, 2008 8:46pm
Quoting TheTopBloke
Smart money knows what happens when you produce money out of thin air.

You can always buy gold, silver, copper, other currencies today, and sell them back at a later date for a huge profit.
Wow, always??? Did the same statement apply when gold hit $1000/oz? Don't get me wrong - I have fairly substantial gold and silver positions and intend to hold them for years, but that doesn't mean they're not under water right now and that doesn't mean I don't wish I hadn't waited to get into them later or jumped in sooner. I do believe the theory still holds in that over a long enough time you will come out on top with these, but don't assume you're not better off keeping your $100K in the bank earning 4% while gold is undergoing a 10% correction.
  • #2,370
  • May 20, 2008 9:10pm May 20, 2008 9:10pm
LOL, literally.
  • #2,371
  • May 20, 2008 10:11pm May 20, 2008 10:11pm
AUD is pushed up probably because of this:

http://bloomberg.com/apps/news?pid=2...mJs&refer=home

Was hoping it would head down soon.
Expected the unexpected
  • #2,372
  • May 21, 2008 1:39am May 21, 2008 1:39am
yes, i was hoping too,but i think it would not happen today
  • #2,373
  • May 21, 2008 8:53am May 21, 2008 8:53am
Can we get a honest short term long term analysis from someone please , maybe some charts and some reasoning behind your forcast. Would be most appreciated?
  • #2,374
  • May 21, 2008 8:53am May 21, 2008 8:53am
for AUD/USD
  • #2,375
  • May 21, 2008 11:05am May 21, 2008 11:05am
ok... does anybody think wave c will actually touch 1:1 ?
  • #2,376
  • May 21, 2008 11:11am May 21, 2008 11:11am
Quoting sirguy1
ok... does anybody think wave c will actually touch 1:1 ?
It's certainly looking a lot like it.
Expected the unexpected
  • #2,377
  • May 21, 2008 2:20pm May 21, 2008 2:20pm
Is anyone really think this pair would/could go down with all the bad news coming against the USD ?
  • #2,378
  • May 21, 2008 2:53pm May 21, 2008 2:53pm
Sorry, I posted the wrong link to the RSI divergence above. If you click it now it should take you to the latest 60M chart.
"A goal without a plan is just a wish."
  • #2,379
  • May 21, 2008 3:03pm May 21, 2008 3:03pm
Quoting norrismp
Sorry, I posted the wrong link to the RSI divergence above. If you click it now it should take you to the latest 60M chart.
I wouldn't bet a dime on an RSI divergence, or any technical divergence for that matter. Most of the time they're completely useless. Daily RSI has been divergent since late Feb, weekly RSI divergent since last July. Not exactly great signals..
  • #2,380
  • May 21, 2008 3:05pm May 21, 2008 3:05pm
Quoting sirguy1
Can we get a honest short term long term analysis from someone please , maybe some charts and some reasoning behind your forcast. Would be most appreciated?
no charts at this tread ? so iŽll give it a try:

aud/usd pushed throug the trendline, i canŽt see any technical reasons for going down (well, OK stochastics are high...). Maybe a little bit higher (look at pivot-points), then down to 95,00 might work at a resistence. EMA 63 and stop-level at 93,00. So until 93,00 is broken, this one might fly to 1,00 and is BULLISH. Tryed 2 times to catch the top, got a bloody nose :-(

Oh, there is a pattern on the daily....and weekly resistence, up trend may stop for a few days, but im confinced this one will reach 1,00 in the near future (2-3 Weeks?).

I ONLY would short this one, if i got a valid bearish candle-stick-pattern at the daily. Just my view...
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