20 Jul 2015
AUD/USD expected to drop further – TDS
FXStreet (Edinburgh) - Strategists at TD Securities see the offered tone gaining pace around the Aussie dollar.
Key Quotes
“We have long argued that the backdrop (especially during the Greek negotiations) was negative for commodity currencies and that these respective central banks were underestimating second round effects from the end of the commodity supercycle”.
“Note that the Australian economy has effectively wiped out the capex boomed observed over the past several years in a matter of quarters”.
“This will raise pressure on the RBA to act. While that is not our base case in the short-term, we think it may be the more attractive currency to bet against with an RBNZ cut fully priced in for July 22”.
“The RBA minutes will be released later this evening and we are concerned that the market may be looking for too significant of a dovish shift especially with the Bank of Canada cutting last week”.
“That said, price action in AUDUSD is bearish, with the 61.8% Fib retracement level standing at 0.7185—well below spot at 0.7377”.
Key Quotes
“We have long argued that the backdrop (especially during the Greek negotiations) was negative for commodity currencies and that these respective central banks were underestimating second round effects from the end of the commodity supercycle”.
“Note that the Australian economy has effectively wiped out the capex boomed observed over the past several years in a matter of quarters”.
“This will raise pressure on the RBA to act. While that is not our base case in the short-term, we think it may be the more attractive currency to bet against with an RBNZ cut fully priced in for July 22”.
“The RBA minutes will be released later this evening and we are concerned that the market may be looking for too significant of a dovish shift especially with the Bank of Canada cutting last week”.
“That said, price action in AUDUSD is bearish, with the 61.8% Fib retracement level standing at 0.7185—well below spot at 0.7377”.